logologologologo
  • Home
  • Business
  • Markets
  • Exchange
  • Investment
  • Personal Finance

5 Unique Stocks That Can Generate Transformational Wealth

These innovative businesses can put patient investors on a path to financial independence.

As much as you might hate to hear this, stock market corrections and bear markets are a perfectly normal part of the investing cycle. Including the current bear market decline that the benchmark S&P 500 and tech-focused Nasdaq Composite are navigating their way through, the broader market has dropped by a double-digit percentage, on average, every 1.85 years since the beginning of 1950.

But there’s another side to this coin. Despite corrections being commonplace, the amount of time Wall Street spends in a bull market handily outpaces periods of pessimism. In other words, stock market corrections and bear market dips serve as the perfect opportunity for patient investors to pounce.

Following peak declines of 24% in the S&P 500 and 34% in the Nasdaq from their respective all-time highs, there are plenty of amazing deals to be had. The following five unique and highly innovative stocks all have the potential to generate transformational wealth for investors willing to give them the time to do so.

Novavax

First up is specialty biotech stock Novavax (NVAX -0.27%), which is one of a handful of companies to have developed a COVID-19 vaccine. Despite Wall Street’s skepticism of the company entering developed markets after established players like Moderna and Pfizer/BioNTech, Novavax’s future looks exceptionally bright.

Novavax has conducted three large-scale clinical trials for NVX-CoV2373, with two adult studies producing respective vaccine efficacies (VEs) of 89.7% and 90.4%. Meanwhile, a study on adolescents, which was released earlier this year, generated an 80% VE. As one of only three COVID-19 vaccine producers to hit the elusive 90% VE mark, Novavax has an opportunity to be a leader in booster shots and/or initial inoculation campaigns in developed and emerging markets.

What’s even more important to recognize is that Novavax’s drug-development platform is a success. This is a company that can beat its competitors to market with a combination influenza/COVID-19 vaccine, or perhaps other vaccines targeting airborne viruses.

If you need one more reason to be excited about this company’s future, keep in mind that Novavax ended March with $1.57 billion in cash and cash equivalents. It’s swimming with capital to fund its future research.

Lovesac

A second unique stock that’s fully capable of helping long-term investors build transformational wealth is furniture company Lovesac (LOVE 7.37%). Although retail stocks are universally despised at the moment, Lovesac offers true differentiation in an industry ripe for disruption.

This differentiation begins with the company’s furniture. While once known for selling “sacs,” the company’s beanbag-styled chairs, Lovesac’s top-seller (87.6% of net sales in fiscal 2022) is now its “sactional.” A sactional is a modular couch that looks like a sectional couch. However, it can be rearranged dozens of ways to fit virtually any living space.

To add to this point, sactionals comes with a bevy of options traditional couches don’t offer. Buyers can choose from one of more than 200 different covers to match the color or theme of their home, and the yarn in these covers is made entirely from recycled plastic water bottles. Sactionals can also be upgraded to include surround-sound or wireless charging systems.

But arguably the best aspect of Lovesac’s operating model is its nimbleness. The company’s omnichannel sales platform allowed it to pivot to online sales during the pandemic. When coupled with brand-name in-store and online partnerships, along with popup showrooms, Lovesac’s overhead costs clock in substantially lower than its predominantly brick-and-mortar-based peers.

Pinterest

Social media stock Pinterest (PINS 7.89%) is another unique company that has the ability to generate life-changing wealth for patient investors. Even though ad-driven businesses like Pinterest are clearly out of favor with the growing likelihood of a recession, this is a company that offers clear and sustainable competitive advantages.

The most telling aspect of Pinterest’s success has been its ability to monetize its users. Despite a drop of 45 million monthly active users (MAUs) in the first quarter, Pinterest’s average revenue per user (ARPU) grew 28% globally, including 40% in Europe and 164% in its “Rest of World” category. What this ARPU growth illustrates is that advertisers are willing to pay a premium to get their message in front of Pinterest’s 433 million MAUs.

To build on this point, Pinterest’s recent MAU decline appears benign. It coincides with COVID-19 vaccination rates picking up and people returning to some semblance of normal. When the lens is widened, Pinterest’s five-year MAU growth has steadily trended higher.

Furthermore, Pinterest’s entire operating model is based on the premise that users are willingly sharing the things, places, and services that interest them. This makes it incredibly easy for the company to help merchants target users.

Root

A fourth unique stock with transformational wealth potential — and possibly the one with the highest risk-versus-reward potential on this list — is technology-driven insurance stock Root (ROOT -7.53%). If Root can overcome sizable short-term losses, its new method of pricing insurance policies could change a stodgy industry.

For decades, auto insurance companies have priced their policies using broad-based metrics, such as a person’s marital status or credit score. Unfortunately, neither statistic provides any insight into what really matters — i.e., how safe a person is behind the wheel.

What Root does is lean on telematics to price its policies. By utilizing sensors in smartphones, Root can get an accurate understanding of a person’s driving habits. When combined with other dynamic factors, the company can offer drivers a tailor-priced policy. Note that this approach to policy pricing can be introduced into other insurance verticals, too.

Thus far, Root’s operating approach has demonstrated promise, as illustrated by its quarterly gross accident period loss ratios below 100%. A loss ratio of less than 100% signifies a profitably written policy. While there’s still work to be done with regard to refining its dynamic pricing model, Root has the potential to completely transform the auto insurance industry.

Berkshire Hathaway

Last, but not least, conglomerate Berkshire Hathaway (BRK.A 3.75%)(BRK.B 4.02%) can help long-term investors generate transformational wealth. Although Warren Buffett’s company recently found its way to a 52-week low, the Oracle of Omaha’s track record speaks for itself.

Since becoming CEO in 1965, Warren Buffett has created more than $590 billion in value for his shareholders and overseen an average annual return of 20.1% for the company’s Class A shares (BRK.A), through Dec. 31, 2021. In aggregate, this works out to an increase of 3,641,613%! Even if Buffett isn’t able to generate an average annual return of 20.1% going forward, he’s proven adept at outpacing the S&P 500 over long periods.

One of the keys to Berkshire Hathaway’s success is its dividend-friendly investment portfolio. While Berkshire doesn’t pay its shareholders a dividend, Buffett’s company is on track to collect more than $6 billion in passive income over the next 12 months, including preferred dividends. Companies that pay a dividend are typically profitable and time-tested. They’ve also handily outperformed their non-dividend-paying peers over multiple decades.

Warren Buffett has packed Berkshire’s investment portfolio with cyclical businesses as well. Even though recessions are inevitable, the Oracle of Omaha is keenly aware that periods of expansion last considerably longer. With over 90% of Berkshire Hathaway’s invested assets tied up in four cyclically oriented sectors, Buffett has positioned his company to take advantage of the natural expansion of the U.S. and global economy.

Related posts

March 24, 2023

TikTok CEO fails to convince Congress app is safe


Read more

Categories

  • Business
  • Content
  • Crypto
  • Exchange
  • Inflation
  • Investment
  • Markets
  • Personal Finance
  • Technology
  • Uncategorized

Archives

  • March 2023
  • February 2023
  • January 2023
  • December 2022
  • November 2022
  • October 2022
  • September 2022
  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021

Recent Posts

  • TikTok CEO fails to convince Congress app is safe
  • Deutsche Bank and UBS shares hit as banking fears keep tight grip
  • SEC sues Tron founder Justin Sun, Lindsay Lohan, other celebrities over crypto sales
  • Employees are checked out at work more than at any time in history — and it makes no difference if they work from home or not. Here’s why
  • Rolls-Royce ‘Wraith Black Arrow’ marks end of V12 coupe era

About Us

The Alpha Cut a Vida Street LLC Company
1404 N. Ronald Reagan Blvd.
Suite 1120
Longwood, FL 32750

Link

(843) 256-4375
https://thealphacut.com

Why Us

Terms & Privacy
Policy & Procedure
Disclaimer

This material is not an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only.
Any performance results discussed herein represent past performance, not a guarantee of future performance, and are not indicative of any specific investment. Due to the timing of information presented, investment performance may be adjusted after the publication of this report. There can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this communication will be profitable, equal any corresponding indicated historical performance levels or be suitable for your portfolio.
All data in this communication is provided for informational purposes only and is not intended for trading or investing purposes. We expressly disclaim the accuracy, adequacy, or completeness of any data and content provided by financial exchanges, individual issuers, their respective affiliates and business partners and shall not be liable for any errors, omissions or other defects in, delays or interruptions in such data, or for any actions taken in reliance thereon. You agree not to copy, modify, reformat, download, store, reproduce, reprocess, transmit or redistribute any data or information found herein or use any such data or information in a commercial enterprise without obtaining our prior written consent.
We make no express or implied warranties or representations and shall have no liability whatsoever with respect to any data contained herein. The data may not be further redistributed or used to create indices or other financial products. This report and the views expressed herein are subject to change at any time based upon market or other conditions (such as domestic and global economic trends) and are current as of the date of publication hereof. The information, analysis, and opinions expressed herein are for general information only and are not intended to provide specific advice or recommendations for any individual or entity.
We emphasize that Investment in the securities of smaller companies can involve greater risk than is generally associated with investment in larger, more established companies, and can result in significant capital losses that may have a detrimental effect on the value of your investments.
Forecasting represents predictions of market prices and/or volume patterns utilizing varying analytical data. It is not representative of a projection of the stock market, or of any specific investment.
Nothing contained in this material is intended to constitute legal, tax, securities or investment advice, nor an opinion regarding the appropriateness of any investment. The general information contained in this publication should not be acted upon without obtaining specific legal, tax and investment advice from a licensed professional.
Please remember that all investments carry some level of risk, including the potential loss of principal invested. They do not typically grow at an even rate of return and may experience negative growth.As with any structuring of a portfolio of investments, attempting to reduce risk and increase return could, at certain times, unintentionally reduce returns.
The information, analysis and opinions expressed herein are for general, impersonal information only and are not intended to provide specific advice or recommendations for any individual entity.

copyright © Alpha Cut 2021. All Right Reserved
The Alpha Cut a Vida Street LLC Company