10 Best Underrated Stocks to Invest
10 Best Underrated Stocks to Invest. Recessions make the rich richer and the poor poorer. Why? Rich people know how to take full advantage of the economy and its cycles while the poor get swept up by a market they don’t even see. You know how rarely we do stocks videos and what happened the last time we did one of these so pay attention by the end of this video not only will you have a list of 10 stocks that we’re investing in right now but you’ll also better understand how to move from being an observer of the markets to an active player.
The best time to invest is when there’s blood on the streets. That’s a metaphor for the entire stock market looking red. We’ll keep this video as beginner friendly as possible, especially since this isn’t financial advice. It’s just keeping you guys up with how we’re moving some of our money around in times like these.
# 1 – Airbnb
The Airbnb price right now is 119 dollars per share. The company is down 44 in the last six months and is currently trading under 120 dollars per share. We bought our first batch at 113 dollars per share, but we’ll consistently gain more and more of all the stocks mentioned in this video in the following weeks. This was a company that was supposed to get annihilated by Covid and they still brought in 6 billion in revenue last year. Tech companies have been crushed lately, but the underlying business is valuable and good. We use Airbnb. We think their product is continuously getting better and we see them as a massive competitor to the entire hotel industry.
In terms of the next 12 months, we don’t expect the stock to stay under 200 dollars a share, giving investors at least a 50 percent return. This is a company that we love with a product we use with a vision for the future and with over 2 billion dollars in free operating cash flow.
# 2 – Adobe
Adobe’s price right now is 395 dollars per share. Adobe is a lot bigger than that pdf reader you have on your computer. Photoshop illustrator premiere after effects and many more are by far the most popular tools of the creator economy. This video is edited on adobe software as our most all videos the majority of logos banners, anything digital for that matter all touch adobe at some point. Same as with Airbnb, Adobe is down 42 percent in the last six months and is currently trading at under four hundred dollars a share.
And even better than Airbnb, Adobe has been making money year after year since we became investors in 2017. This is a highly profitable company in a space that’s growing faster than ever before, with products that are consistently getting better. 12 months from now we’re expecting at least a retreatment back, which will provide investors with at least 40 returns. With the rise of web 3 digital will explode and we’re betting hard on companies that will play a part in creating this new market which brings us to the next company.
# 3 – Nvidia
The Nvidia price right now is 166 dollars per share. Most people might not understand it but the Metaverse is coming. Actually, it’s already here. All of it will run on graphics processing units or GPUs; these are in every computer out there; it’s what allows your computer to generate visuals. Nvidia is one of our superstars. Everything we see coming will rely on the software they produce and that includes gaming VR AR and Metaverse worlds. These niches are growing exponentially faster than anything else around and GPUs are essential to all of them.
The goliath in this space is Nvidia and there’s no way they will not make bank in the next decade. Stock wise, we follow the same market pattern. Share price is down 46 percent in the last six months and it’s currently trading around 166 dollars. This is a company that has an average 36 percent profit margin and is bringing in over 25 billion dollars in revenue this year. There’s no reason for the huge discount we’re seeing on the share price right now, so we’re taking advantage of it. Best-case scenario, you’re doubling your money in the next 12 months worst-case scenario. The stock will be around 160 dollars so not much to lose. We can’t wait to see if we’re right about this one, especially since the next company is leveraging Nvidia’s tech.
# 4 Unity Software
Unity is one of our more aggressive plays in every portfolio. You should have a few of these that have the potential to outpace everything. There are two massive players in the world of game engines, Unreal engine which is now owned by Tencent, the Chinese company and Unity.
Although Unreal has unlimited money available, Unity is the underdog that’s been able to hold its own. Their software allows for ultra-realistic graphics. What you see on the screen right now isn’t an actual human. We believe that in the next decade we’ll cross into what is called the uncanny valley, a point in technology where you won’t be able to tell if what you’re seeing is an actual human or if it’s computer generated.
Unity is playing a big role in that, so let’s talk about financials. Unity is down a whopping eighty-two percent in the last six months, with the price trading above thirty dollars a share. From our perspective, this is a perfect asymmetric risk situation that has the potential to provide incredible returns for investors in the next 12 months. The company had 320 million dollars in sales in the first quarter, which is ballpark what they spent last year to gain parsec. These might be famous last words here, but Unity is probably gonna be fine.
# 5 – Nike
Nike’s price point right now is 109 dollars per share. Bet you didn’t expect to see a shoe company on this list, but hey if it makes sense, it makes money. We love Nike. and buy products from them. We enjoy their products and they’re part of the culture. You should own shares in the companies that make the products you love that don’t sell unless their products stop fulfilling your needs. As long as you remember this rule, you’ll be fine in the investing world.
Nike is iconic but despite their size, brand power and reputation, they got caught up in the market cross wins with everyone else. They’re down almost 40 percent in the last six months. For a company that’s consistently growing sales year over year, a company that brought in almost 45 billion dollars in revenue last year.
When all this charade eventually fades, the stock will recover because any business that has this kind of brand loyalty will pull through. Twelve months from now, look at fifty percent plus returns on your investment in Nike.
#6 – Under Armor
Under Armor’s price right now is eleven dollars a share. We jumped in April 2020 at eight dollars per share and liquidated our position last October at twenty-one dollars a share. We feel like now it’d be a great time to jump back in the last six months Under Amour stock is down 60 percent. They’re a great company and, as with everything else on this list, we enjoy their products. We love the underdog position and how creative they have to be to keep up with the big boys like Nike and Adidas and they’re doing great.
They’re able to remain competitive by having a smaller profit margin at six percent compared to that of Nike. for example, that’s at 12 percent. This is the play you make when you want to penetrate the market and build up the brand. 5.6 billion in revenue doesn’t lie. In terms of 12-month projections, we expect the stock to return to somewhere in the 20 dollar range, at which point we might consider partially liquidating our position.
# 7 – PayPal
PayPal is priced right now 76 dollars per share. PayPal is one of those counter-intuitive bets. It’s too tech for old people to care about it but too old tech for the Web 3 kids to find it cool. PayPal is no longer a cool business but it’s still making a ton of money and growing in users. Most people don’t realize that 22 percent of all online transactions in the US are handled through Paypal and even with all of that, the company crashed 65% in the last six months.
The all-time high was 300 per share only 10 months ago and the same share is trading around 75 bucks today. This is a company that brought in 25 billion dollars last year and is growing everywhere around the world where more and more people get access to online marketplaces. Do you know about Venmo? Do you use Venmo well? PayPal actually owns it as part of its payments ecosystem. With e-commerce on the rise with online access quickly entering markets we’ve never had before, we think PayPal has a pretty good strong case to stay.
# 8 – Square
Square price right now is 78 dollars per share. From one payment processor to the next, we love betting on multiple players in the same industry because if we feel like the industry is expanding; it doesn’t matter if you pick the right horse. Square is the brainchild of one of our favorite entrepreneurs, Jack Dorsey, the founder of twitter. In the past six months Square is down almost 70 percent. We began investing in Square in the middle of 2020 at 85 dollars a share. As their growth began and because we are constantly restructuring our portfolios, we fully exited the position at the end of October last year at 265 dollars per share, making it one of our best investments to date.
And now that the stock is back under 80 dollars, well we want to go on that ride again the company is making bank and with Elon taking over twitter Jack is more focused on Square and honestly we’re expecting at least a 2x from where we are today in the next 12 months.
# 9 – Spotify
Spotify. Spotify is another one of those companies that we’ve had in our portfolio. We entered at 150 dollars, exited at 250 and forgot about it. When this tech crash came around, we checked our favorites and lo-and-behold, Spotify was trading at under 100 dollars a share. Last year they took 1.5 billion dollars in financing and the company is looking a lot better on paper than the markets would make you believe.
And yes, they’re one of those companies that lose a little of money every year but the number of paying users is growing year over year. Spotify has gone up against Apple and google and they still made a name for themselves. We think they’re a viable candidate for 50 percent plus returns in the next 12 months.
# 10 – Coinbase
Coinbase price right now 66 dollars per share. We’re going there because this might end up being the best trade in this entire list. Coinbase, the largest regulated crypto exchange in the United States, is trading at 66 dollars per share down from 350 dollars back in November. The stock is down 80 in the last six months. Now this is a super-fast growing business in an emerging sector that’s making between 25 up to 50 percent margins no matter if the price of crypto is up or down.
Exchanges don’t care about the price of the coins transacted on the platform as they make their money on commissions on said transactions. The number of users is going up, revenue is going up, profits are going up yet the stock is tanking. Their profit to earnings ratio is 5.6 for those of you who are into financial analysis and that’s insanely good. Apple, for example, has a PE of 23.1. By this point, you know we believe crypto is here to stay.
We’re accumulating there as well. This is an opportunity for those of you who want exposure to crypto but don’t want to get caught up in all the wallets, coins and exchange environments. Once this crypto bear market is over, we’re expecting Coinbase stock to trade above 200 dollars a share. This actually might be one of those moments where stock investing could be less risky and more profitable than Crypto.
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