This is going to be an exciting month. Earnings started to come out in the last few weeks and, despite the pandemic, my favorite companies are looking great. Of course, there are still a few more reports due for this week, but that’s not really the focus of this blog. It’s the start of the month, which means that it’s time for a new top five stocks list!
Hello everyone, and welcome back to Investing with Antoaneta. In today’s blog, I’ll give you my top five stocks for May.
Before we dive right in, I just want to give you a quick reminder to like, share, and do all that good stuff that helps our little community grow. Check out my other blogs such as, “Michael Burry Sold & Reduced 18 Positions“.
Last year around this time, when I created my first Investing blog, I mentioned five tech stocks that I believe every serious long-term investor should consider for their portfolio – Amazon, Google, Facebook, Apple, and Microsoft. And it should come as no surprise that a couple of these businesses are on my list for this month as well. Of course, I’ve added a couple of other stocks as well because, one, diversification is absolutely crucial for long-term investing, and two, we can’t just keep talking about the same five companies month after month. No matter how good they are, it’ll just get boring eventually.
Today, we’re talking about these stocks:
- Amazon (AMZN)
- Facebook (FB)
- Shopify (SHOP)
- Apple (AAPL)
- Fiverr (FVRR)
and if you stay with me till the end of the blog I have a bonus for you, some extra stocks that you can consider too
Amazon is a multinational e-commerce and tech giant with brilliant financials. I’m a big believer in Amazon from a long-term investment standpoint, and the results in the latest report only reaffirm my opinion.
- Current Price: $ 3,311.87 (today change: – 74.62(-2.20%))
- Market Cap: 1.67T
- P/E Ratio: 63.01
- EPS: 52.56
Amazon (ticker symbol AMZN) is currently one of the best growth stocks on the entire market. Between last March (March 23, 2020) and now Amazon went from $1,900 to $3,200. That’s even better than the S&P 500 (which went up by around 41% over the same period).
But that shouldn’t really come as a surprise since Amazon has a proven track record. Their stock price is up more than 236 000 % [two hundred thirty-six thousand].
Now, I know that there are many investors out there who think Amazon stock is too expensive at the moment. And I agree … to some extent. I have no issues adding more AMZN to my portfolio because I am a big believer in the company’s future, and I’ve spent a lot of time reading through their reports. However, this is one of the stocks that I consider MUST hold.
If you’re going to buy Amazon stock, you need to have the right mindset.
There might be some hiccups here and there, but Amazon has demonstrated the ability to keep growing year and after, and there’s no reason to believe that it’s going to stop anytime soon. So, yes, Amazon definitely takes the top spot in this month’s list.
- Current Price: $318.36 (today change: -4.22 (-1.31%))
- Market Cap: 902.697B
- P/E Ratio: 27.28
- EPS: 11.67
In my opinion, Facebook is still undervalued. I’m certain that this won’t be the case for much longer, but meanwhile, I’ll happily keep adding more and more Facebook stock to my portfolio.
I like Facebook because:
- Their ads are cheaper than their competitors (Google, Amazon, etc.)
- They’ve got well-established brands and different platforms, popular across all age groups (Facebook, Instagram, WhatsApp).
- They’ve got a massive user base between all their apps.
- They are investing big money into R&D.
- Their upcoming AR & VR tech could leave their competitors in the dust.
During the Q1 2021 Earnings call, CEO Mark Zuckerberg shared that, presently, Facebook enjoys more than 2.7 billion daily users and is used by over 200 million businesses for marketing and advertising purposes. Additionally, there are over 1 million active shops and over 250 million monthly shops and visitors. Last year WhatsApp received a cart update, which has been used more than 5 million times so far.
For the last couple of quarters, Facebook’s managed to exceed management’s expectations, freeing up funds and “giving them the confidence” (in Zuckerberg’s own words) to make big investments into the R&D side of the business.
Big money has been put into augmented and virtual reality tech to enable “a deeper sense of presence in social connection”. If this tech takes off, it could give Facebook an absolutely massive edge over the competition since no other platform offers this kind of user experience.
Of course, VR tech isn’t taking up all the budget. Facebook is also working on improving its native commerce tools across all apps, including Instagram and WhatsApp. The latest WhatsApp update also includes expanded catalog functionality, allowing businesses to update their catalogs without needing a mobile device.
Here’s the stats summary:
- Daily Active Users (DAUs) – 1.88 billion on average for March 2021 (up 8% year-over-year)
- Monthly Active Users (MAUs) – 2.85 billion on average as of March 31, 2021 (up 10% year-over-year)
- Family Daily Active People (DAP) – 2.72 billion on average for March 2021 (up 15% year-over-year)
- Family Monthly Active People (MAP) – 3.45 billion as of March 31, 2021 (up 15% year-over-year)
- Capital Expenditures for Q1 2021 – $4.42 billion (including principal payments on finance leases)
- Cash & Cash Equivalents – $64.22 billion as of March 31, 2021
- Headcount – 60,654 as of March 31, 2021 (up 26% year-over-year)
Apple Inc, ticker symbol AAPL
- Current Price: $127.85 (today change: -4.69 (-3.54%))
- Market Cap: 2.134T
- P/E Ratio: 28.74
- EPS: 4.45
With a quarterly revenue of 89.6 billion dollars (up 54% year-over-year) and quarterly earnings per diluted share of 1.40, Apple’s latest quarterly report is looking as solid as it gets. The tech giant managed a record-breaking revenue performance across all geographic segments and “strong double-digit growth” in each product category, driving their “installed base of active devices to an all-time high”.
And, if you’ve been keeping a close eye on the tech field during the lockdowns, this shouldn’t really come as a surprise. When everyone is stuck at home with nothing to do (and almost nothing to spend money on), it’s logical to expect that tech-related businesses are going to do well. This works even better when it comes to Apple because their products tend to be more expensive than the available alternatives. Of course, when someone really wants an Apple product, they’re going to get one despite the price tag, but the increase in money on hand that most people experienced during the pandemic certainly helped Apple push their numbers up quite a bit.
Or, as Apple CEO Tim Cook put it:
“This quarter reflects both the enduring ways our products have helped our users meet this moment in their own lives, as well as the optimism consumers, seem to feel about better days ahead for all of us.”
Here’s the stats summary:
- Quarterly Revenue – $89.6 billion (up 54% year-over-year)
- Quarterly Earnings per diluted share – $1.40
- Operating cash flow – $24 billion
- International sales account for 67% of the quarterly revenue.
- Current Price: $191.67 (today change: -8.77 (-4.38%))
- Market Cap: 6.87B
- EPS: -2.29
Between the lockdowns, remote work requirements, business shutdowns, and personnel layoffs, Fiverr’s success should surprise no one. The situation is pretty simple here: businesses will always have work that needs doing, and people will always need money. The lockdowns just made it so that there was more work and fewer (if any) people to do it on-site. This put Fiverr in the ideal position to profit from the situation.
The platform’s revenue comes from both employers and gig workers, for an impressive combined take rate of 27%. And when you’ve got over 3.4 million customers, spread across more than 160 countries and 500 categories, that 27% quickly adds up.
Revenue up 77% year-over-year
The average amount spent per buyer grew to $205 (up 20% year-over-year)
- Current Price: $1,142.94 (today change: +20.93 (+1.87%))
- Market Cap: 142.363B
- P/E Ratio: 89.38
- EPS: 12.79
Shopify, ticker symbol SHOP is having a fantastic time. The company published one of the most amazing first-quarter financial results that I’ve seen lately, and their stock went up more than 10%.
Here’s a quick rundown:
- $988.6 mil. revenue (up by 110% year over year)
- $320.7 mil. Subscription revenue (up 71%)
- $668 mil. Merchant solutions revenue (up 137%)
“Our singular focus is on making entrepreneurship easier and making it easier for entrepreneurs to succeed.”
Harley Finkelstein, Shopify president
During this last year, digital shopping was the go-to solution for most consumers, and this strategy has paid off big time for Shopify. However, management has noted that the e-commerce growth is expected to slow down as the restrictions relax, and people return to their old shopping habits. Of course, this isn’t “the end” for Shopify because, let’s face it – shopping online is just much more convenient, and the younger generations have already demonstrated a preference for it. So, while their growth rate might slow down, management is positive that they will continue growing.
And don’t worry, because we’re not supposed to just sit there and “hope” for this growth to pop out of thin air. Instead, management will be reinvesting heavily back into the business during the year to ensure better results moving forward. Given the 7.9 billion dollars in cash reserves, I believe that Shopify can definitely make good on this forecast.
“We expect full-year 2021 adjusted operating income to be below the level we achieved in 2020.”
Back when I first got into Shopify, the stock was going for $100 per share. Once it hit $300, I sold out of the position and started building it back up not long after. And, yes, I could be a bit biased here since a couple of my businesses use Shopify, but the company is as solid as it gets.
- Atlassian (TEAM) – Cloud-based business productivity with solid revenue growth (over 40% in the past four years), strong cash flow, and good margins.
- Disney (DIS) – theme parks, movies, on-demand streaming services, lots of merch, and a ton of extremely well-known & valuable IP. Disney is definitely one of the most dominant companies in the entire entertainment field, and I believe that every long-term investor should have a look at it. (we talked about Disney in one of the recent blogs, I’ll leave a link for you down in the description below)
- Tattooed Chef (TTCF) – A vertically integrated plant-based meat substitute company that’s not in direct competition with any other industry leaders? Different angles, different strategies, massive growth, incredible potential for long-term margins & profitability? Sign me right up! I believe that it’s only a matter of time until Wall Street and big investors out there pick up on this stock and the price skyrockets.
- Coinbase Global (COIN) – Coinbase (the largest crypto exchange platform in the US) went public recently. Now, they’re trading under the ticker symbol COIN, and most investors (myself included) who have looked into crypto are very excited about this opportunity.
Remember, guys – I’m not making these lists to make you “invest in these companies because I invest in them”. I’m simply giving you my opinions and explaining my thought process. I like the businesses that I like because I’ve done my research. I understand the models, and I like the management.
This one’s especially important for the newbies – if you’re a new investor and you decide to look into the stocks that I mentioned today, please make sure that you understand them well before investing. If you don’t understand a company or don’t agree with the model or the management or whatever, do not give them your money.
Go and find some other stocks that you will like better!
You didn’t get into long-term investing to worry about the future. You did it so you can lead a happier life, free of stress and worries. I know it sounds overwhelming when you’re new, but believe me, you’ll get to this point in no time! Just do the research, make your purchases after you’re confident in the company and just hold them.
And, that’s why I go through all of this effort to explain my reasoning and approach. Because even if you don’t care about these companies, you can still benefit from the content.
Oh, and speaking of content … if you happen to like the content on this platform, you wouldn’t mind letting me know with a thumbs up and a share, right? Why not go ahead and drop me a comment as well while you’re at it? Thanks a bunch
That’s all I’ve got for you today, guys.
I hope that you enjoyed it, and I’ll see you all next time!
Recommended for further reading:
- Stock Market Investing For Beginners: The Investment Guide – How to benefit from the crisis, invest in stocks and generate long-term passive income incl. ETF and Stock Picking Checklist
- The Stock Market Investing Guide #2020: From Beginner to Intelligent Investor within 30 Days – How to Save Money, Generate Passive Income and Reach Financial Freedom
- The Financial Times Guide to Investing: The Definitive Companion to Investment and the Financial Markets: The Definitive Companion to Investment and the Financial Markets
- Stock Market Investing For Beginners: The Investment Guide
- The Barefoot Investor: The Only Money Guide You’ll Ever Need