What are your plans for the new year? What additions will you make to your portfolio?
As markets prepare to enter 2021, it is worth noting that the significant market divergence in equities over the last couple of quarters was seen. Even though the indices have reached record peaks, a lot of growth companies and small-caps have entered the bear market territory. Either way, even if the main indices are at all-time highs, there are still enough opportunities.
There are a couple of equities that are near levels where it is impossible to resist purchasing. Therefore, the four equities listed below could be profitable and are worth adding to the portfolio in the coming year.
The concept that an untested manufacturer producing about 20,000 EVs per year could demand a $90 billion market valuation was so absurd that investors were in no hurry to invest at the time. Nonetheless, here we are.
After about a year, it can be said that investors now are really satisfied with how Nio's team has scaled up production in the aftermath of pandemic supply problems and greater inflation. The firm's innovation will keep driving market stock profits in China for many years.
In terms of output, Nio produced nearly 10,900 EVs last month, putting it on a projected run-rate of 130,000 EVs per year. The business estimates a yearly run rate of 600,000 EVs by the end of 2022. Nio could surpass the growth rate of Tesla Motors by delivering three new EVs in the coming year, as well as steadily boosting sales for its current portfolio of SUVs and its crossover EV. Nio's battery-as-a-service (BaaS) technology is rather impressive. Owners of BaaS cars enjoy a discount on the original purchase price of their cars and may charge, switch, and renew their batteries over time. Nio benefits from increased brand image and high-margin fee income years after purchase.
Nio is currently the only pure-play EV maker with the full attention of investors.
In a sector where many companies are still trading at significant premiums, the cannabis sector offers some of the finest opportunities. Cresco Labs (CRLBF), a marijuana company, is one such stock that will be worth buying in the coming year.
To address the elephant in the room, federal legalization is desirable whenever marijuana stocks are mentioned, but it is not required for cannabis companies to succeed. With 36 states legalizing pot in some format and the federal authorities permitting individual states to manage their businesses, cannabis companies like Cresco Labs have a clear road to success.
Like practically all multi-state companies, Cresco Labs is trying to expand its retail footprint, recently opening its 45th location countrywide. It is, though, largely interested in expanding into high-value limited-license regions like Illinois and Ohio. In regions where authorities purposefully restrict the number of sales licenses awarded, Cresco has a better chance of establishing its brand and gaining a devoted clientship.
The finest part about Cresco Labs is its leading wholesale section in the industry. Because of its low profitability, wholesale marijuana is often written off by Wall Street. However, when it comes to a firm like Cresco, which has a pot retail license in California, the largest marijuana marketplace, volume more than compensates for any margin issues.
Novavax (NVAX), a biotechnology firm, is another rising business that will be interesting for investors in 2022.
Similarly to Nio, it was believed that pursuing coronavirus vaccine equities at the start of 2021 would be a bad idea. In many cases, COVID-19 equities were unreasonably expensive. After a year of information analysis, Novavax can be called the most appealing coronavirus play.
Novavax shined with their clinical trial results for NVX-CoV2373, as some of you may already be aware. Studies published in March in the United Kingdom and in June in the United States and Mexico indicated vaccine effectiveness (VE) of 89.7% and 90.4%, respectively. This makes Novavax one of three Novavax vaccine makers to achieve a 90% VE threshold, allowing it to compete with global players.
The only explanation Novavax's stock price hasn't skyrocketed is due to delays in applying for emergency use permits in crucial markets, as well as manufacturing bottlenecks. Fortunately, these concerns are being addressed, and governments are starting to give Novavax the stamp of approval.
Furthermore, illness variations make it probable that COVID-19 will become endemic. This means that Novavax might benefit from initial immunizations, booster doses, and potentially even influenza combination vaccines, which the firm is creating and testing.
Ping Identity (PING), a cybersecurity company, is the fourth and last equity on the list worthy of purchase in the coming year.
Investors believe cybersecurity will be the most secure double-digit growth sector over the next decade. It has grown into a fundamental need, and more organizations than before are transferring their and their customers' data to cloud services. That's a winning formula for 3rd-party solution providers such as Ping.
Ping's cloud technology, like other high-performing security services, is heavily reliant on AI. Over time, it successfully grows smarter at spotting and reacting to hazards. Ping Identity can offer the biggest value when built on top of on-premises options. Ping's architecture bridges the security holes left by on-premises security by delivering constant user tracking, authentication, and authorization.
Ping is also making progress in its efforts to transition customers away from term-based subscriptions and toward software-as-a-service (SaaS) subscriptions. The latter is expected to lead to larger profitability and higher customer retention rates in the long term. It is worth mentioning that the gross subscription margins are currently holding at a healthy 85%.
While most cyberspace security companies are still priced at exorbitant sales ratios, Ping is lucrative and can be purchased approximately six times Wall Street's expected 2022 sales. That is a great deal for what should be an industry winner for many years to come.
Goldman Sachs raised its forecast for year-end Brent crude oil prices to $90 per barrel from $80, as a faster fuel demand recovery from Delta variant and Hurricane Ida's hit to production led to tight global supplies.Banks and Finance
They might, however, be correct. While the Fed tightens, investors could take advantage of the seasonality and be spectators to the drama this summer. The market will almost certainly fall in the first four months of the year.Banks and Finance