The stock market has a history of rewarding patient investors with blockbuster returns. It’s the ultimate vehicle for generating long-term wealth, even when investing conservatively in a diversified index like the S&P 500, which has grown by 3,740% since 1981.
But even that dizzying return has been crushed by some individual stocks — mainly in the technology sector — that have delivered game-changing products and services over the years.
We’re still in the early innings of the current decade, but here are two stocks that could run circles around the broader market between now and 2030.
1. The case for Sea Limited
When it comes to the digital economy, Singapore-based Sea Limited (NYSE:SE) is a triple threat. It operates in three of the hottest sectors in the technological realm: Mobile gaming, e-commerce, and digital payments.
Its gaming brand is titled Garena, and it boasts over 729 million quarterly active users. It’s primarily driven by its Free Fire mobile game, which surpassed 1 billion downloads this year and recently notched a record-high 150 million daily active users. The game was released in 2017, and yet is still growing in popularity.
While gaming falls under Sea’s largest segment by revenue, digital entertainment, its e-commerce piece is almost equally as formidable. The company’s Shopee app connects buyers and sellers with a hybrid consumer-to-consumer and business-to-consumer model, and it is consistently in the top two most downloaded apps globally in Alphabet‘s Google Play store, and Apple‘s App Store.
Together with its fintech business that now supports over 39 million users, Sea Limited’s brand portfolio has combined to generate hyper-growth.
For a stock to rise fivefold by 2030, it would need to grow revenue by a compound annual rate of about 20%, assuming its present price-to-sales ratio remained exactly the same. Sea Limited is trouncing that growth rate, which could present a big opportunity for investors.
While the company isn’t profitable just yet, it’s expected to inch much closer to breakeven in 2022 while surpassing $13 billion in revenue. It shouldn’t be long before investors reap the added benefits of…
Continue reading at THE MOTLEY FOOL