“Tesla will be $2,000 a share in four years.”
That’s the conclusion of ARK Invest’s latest research.this is fun readingARK expects the self-driving taxi business to drive Tesla’s share price up an average of 88% annually.
Don’t rush to find a taxi. is not. “But don’t worry,” she says ARK. So at 10.8x book value, which is nearly four times the stock price of the average S&P 500 company, it’s a bargain. “
i am skeptical. I don’t think self-driving taxis will take passengers where they want to go right away. The reason is simple: people don’t trust you.
Waymo runs a small service near where I live in Phoenix, Arizona. A lot of people I talk to are wary of using it. They prefer human drivers…because, even with their flaws, humans provide comfort.
Tesla has data showing self-driving cars are safer. But they need to convince consumers to use their cars…and get regulators to approve them first, something ARK Invest seems to have ignored his It’s an uphill battle between the two. The technology may be great, but it’s pointless if regulators don’t allow its deployment.
There is also the risk of competition. Companies like Waymo, owned by Google’s parent company Alphabet, are working on the same idea. Apple is also working on self-driving cars. So does Uber. Well-funded competitors are a risk to ARK’s valuation model, and seem to assume Tesla will be the only driverless taxi service in town.
There is also the risk that regulators will stop testing because the technology does not work as expected.A few years ago, Uber’s progress was delay in a fatal accident. It will only take another year, plus he will be delayed for another year.
And all of this simply says nothing about the risks of owning tech stocks. They were some of the worst performers in the bear market.
Investors in technology stocks should understand these risks. It means really understanding technology. Few people understand the technology behind the biggest tech companies.
Luckily, you don’t have to look at tech stocks to get an 88% annual return. In fact, many of the stocks that have risen over the past few years have not been technology stocks.
Here are the seven stocks that averaged over 88% annual returns over the past four years: I’ve highlighted three that are clearly low tech.
Applied Digital Corporation (APLD) is a blockchain company turned consultant that helps data centers work with local utilities.
Celsius Holdings (CELH) manufactures energy drinks. The company’s products are sold in grocery stores, convenience stores, gyms and spas.
XPEL Inc. (XPEL) provides paint protection, window films, and other automotive aftersales parts.
These are not tech companies. But they brought extraordinary benefits. And contrary to what you might think, it’s not uncommon for non-tech stocks to deliver incredible returns.
However, it is unusual to see 88% annual growth over four years in any sector. Over the past decade, only his 16 companies in the Russell 3000 Index have recorded increases in size at one point. I doubt Tesla will join that list any time soon.
However, I noticed something special about the above list…
Look at the rightmost column. Most of these stocks, four years ago he was trading at less than $5 a share.
Some of the biggest winners started at very low prices. Stocks under $5 Just what Adam O’Dell is looking for.
If ARK is correct about Tesla, the company’s market cap will exceed $6.3 trillion over four years. If the US economy grows 5% a year, an equally ridiculous assumption in itself, TSLA is worth 20% of GDP.
This doesn’t mean you can’t pursue spectacular returns. Just look outside the range of mega-cap tech stocks.
Build-A-Bear Workshop Inc. (BBW) has quietly won and held over 2,800% from pandemic lows near $1 to recent highs.
Build-A-Bear is not a tech company. It didn’t take any technical knowledge to figure it out. A place to take the kids and make stuffed animals. Children like to go there. We love to see our children and grandchildren doing what they love.
I know there are talented researchers on the ARK team. But I hope they go beyond technology and help us find the next Build-A-Bear instead.
Fortunately, our team is working on it, with Adam leading the way.
He released a presentation detailing it. A very special group of $5 stocksThey all rank in the top 5 percentiles of his Stock Power Ratings system, which has been historically proven to identify stocks with high odds that outperform the market 3 to 1.
But for reasons Adam explains in this webinar, he believes these stocks will perform 500% or more over the next year.
he just recommended these names to him 10x stock I’m a subscriber, but I still have time to join. Go here for all the details.
But whatever you decide to do, I encourage you to think outside the box when starting to build your portfolio for the next bear market.
Take these lofty price predictions with a pinch of salt. And naturally, focus on small caps where simple businesses are on the rise. Complex businesses aren’t falling large caps.
Adam and I continue to help you find these strains here and here. stock power daily.
nice to meet you, Michael Carr Editor, one trade
It’s funny. I’ve recently found myself spending too much time reading breaking news that isn’t very helpful or insightful.
I still check the headlines first thing in the morning, then again at lunch. But I stopped checking his news feed all day and started picking up books instead.
It’s not that shocking, but you can get more done by eliminating endless scrolling time wasters. In the past two weeks he has even read through three thick books in one sitting.
Eliminating distractions, such as reading the same headline over and over, can accomplish amazing things.
anyway i enjoy the book Paul Oyer called Economists in the Game: How to Ditch $580 Million and Other Amazing Insights from Sports Economics.
I still have many unanswered questions. How do professional football teams make money from TV if there are no commercials outside of halftime? What are the benefits for TV networks?
The book was full of gems.
As an example, I instinctively hate scalpers. they just feel unsafe.But economists Love Scalper. It creates liquidity in what is often an illiquid market for ticket buyers and sellers. It also has the potential to generate a net profit from the trade.
Let me explain: If you buy tickets for a game and for some reason can’t attend, those tickets are worthless. However, you can sell to scalpers (ahem, “brokers”).
Everything you get on sale will be in better condition than before. Additionally, a scalper will take care of your behalf in finding a buyer. If not, they Eat the loss, not you.
Interestingly, new entrants like StubHub are cutting out a lot of middlemen, and to use Wall Street terminology, bid-ask spread.
Simply put, the “bid-ask spread” is the difference between the price the buyer pays and the price the seller gets – the shrinking profit of the scalper. The incentives for enterprising ticker flippers are getting smaller now.
The stock market has undergone similar changes over the last 50 years. The amount of time, money, and brains put into stock analysis has made stock selection very competitive. It also squeezes much of the broker’s profits, but ultimately offers a more liquid market.
But this generally only applies to large companies. The small-cap market is still the Wild West in many ways. As such, investors typically expect a premium for investing in smaller companies.
this is the reason size One of Adam O’Dell’s six key elements. Stock Power Rating System.
I was thinking about this while watching Adam’s trading strategy and his latest research. quality small caps. accurately because Large institutional investors cannot own Stocks priced below $5 (At least without jumping through expensive hoops), that corner of the market is more illiquid.
You can find real undiscovered gems that you won’t find anywhere else.
In any case, be sure to tune Banyan Edge Podcast on monday. Host a ‘Banyan Book Club’ where Adam, Amber Lancaster and Ian King share the books they read.
Please join us. You may learn something new!
nice to meet you,
Charles Sizemore Editor-in-chief, The Banyan Edge