12 Stocks for 2021
No in depth explanation, just straight to the picks. Each stock should see tailwinds from 2021 and beyond, not just a play on 2021. They are also a mixture of low to very high risk, so make sure to do your own due diligence. Listed below in alphabetical order:
Digital Turbine - APPS - Current Price $56.56, Market Cap $5B
Celsius Holdings - CELH* - Current Price $50.31, Market Cap $3.6B
DocuSign - DOCU* - Current Price $222.30, Market Cap $41B
GigCapital3 / Lightning eMotors - GIK / ZEV* - Current Price $13.18, Market Cap $341M
Cloudflare - NET - Current Price $75.99, Market Cap $23B
Nano-X Imaging - NNOX* - Current Price $45.66, Market Cap $2.1B
Redfin - RDFN* - Current Price $68.63, Market Cap $7B
Sea Limited - SE* - Current Price $199.05, Market Cap $101B
Spotify - SPOT* - Current Price $314.66, Market Cap $59B
Teladoc Health - TDOC* - Current Price $199.96, Market Cap $29B
Unity Technologies - U* - Current Price $153.47, Market Cap $42B
Ulta Beauty - ULTA* - Current Price $287.16, Market Cap $16B
*Stocks I own and am long.
I don’t ever purchase stocks for a year or less. My goal is to hold them long term, but I do see possible expansion in each of these 12 stocks for 2021. What follows is a brief overview of each company. At the end, I outline the industries that I believe will see tremendous growth over the next decade or longer. Cheers!
$APPS – Digital Turbine (local to ATX) – Market Cap of $5B
Profile: Software to control, manage, and monetize mobile devices
Risk: Medium risk –> concentration of debtors, 2020 perf. 693%
Quick stats: Rev Growth YoY 93%, P/S 24, 50-MA 36%, CR 0.9, Glassdoor 97%
Tailwinds: Advertising technology, new app introduction/acceptance, monetization of mobile devices
Key 2021 headwind: Customer concentration
Top reason why I might consider selling in the future: A larger player comes in to build a platform that hurts APPS margins/growth.
$CELH – Celsius Holdings – Market Cap of $3.6B
Profile: Calorie burning energy drink
Risk: Medium risk –> competitive industry, 2020 perf. 959% increase
Quick stats: Rev Growth YoY 80%, P/S 29, 50-MA 59%, CR 3.2, Glassdoor N/A
Tailwinds: Reopening of gyms, health kick in 2021, expansion internationally
Key 2021 headwind: Energy drink competition
Top reason why I might consider selling in the future: None at the moment.
$DOCU – DocuSign – Market Cap of $41B
Profile: E-signature and agreement cloud service
Risk: Low risk –> e-signature adoption in all industries
Quick stats: Rev Growth YoY 53%, P/S 32, 50-MA -1%, CR 1, Glassdoor 98%
Tailwinds: Digitization of health, real estate boom, upsell to Agreement cloud
Key 2021 Headwind: Competition from Adobe
Top reason why I might consider selling in the future: None at the moment.
$GIK / $ZEV – Lightning eMotors – Market Cap of $341M
Profile: Zero Emission Vehicle (ZEV) ecosystem for delivery vehicles
Risk: Very high risk –> merging with GigCapital3 SPAC in 2021, no record of consistent public reporting/profitability
Quick stats: Rev Growth YoY N/A (Rev. $9M in 2020), 50-MA +17%, CR N/A, Glassdoor N/A
Tailwinds: Electric vehicle boom, carbo-zero policies, 250-mile range
Key 2021 headwind: Supply chain production
I like the whole electric vehicle delivery space. Currently includes:
XL Fleet (Ticker: XL) -> Currently works on hybrid electrification solutions for delivery vehicles class 2 to 6.
Forum Merger III / Electric Last Mile (Ticker: FIII / ELMS) -> Currently going to produce a class 1 electric delivery van.
I am leaning more toward Lighting eMotors because they produce the only zero emission electrification solution for class 4 to 7 vehicles and they have an entire electrification suite of products to serve those vehicles. Their new product offers a range up to 250 miles and should be available in Q2 of 2021. See their offerings below:
Top reason why I might consider selling in the future: The company consistently fails to hit their projections.
$NET – Cloudflare – Market Cap of $23B
Profile: Network security and performance services to businesses
Risk: Medium risk –> very high valuation
Quick stats: Rev Growth YoY 54% P/S 58, 50-MA +9.7%, CR 8.6, Glassdoor 92% (Hiring Surge)
Tailwinds: Digitization trend, need for security, need for online performance
Key 2021 headwind: High valuation
Top reason why I might consider selling in the future: None at the moment.
$NNOX – Nano-X Imaging – Market Cap of $2.1B
Profile: Medical imaging systems for the masses
Risk: Very high risk –> recent unveiling of Nanox.ARC, no FDA approval yet
Quick stats: Rev Growth YoY N/A, P/S N/A, 50-MA +9%, CR N/A, Glassdoor N/A
Tailwinds: Democratization of imaging, preventative care, third world need for imaging
Key 2021 headwind: FDA approval of ARC device
The company just recently (Nov 2020) unveiled their ARC imaging solution. The product might not scan at the levels of a CT Scan, but will still allow for imaging at a price and level that will democratize imaging for the world. US FDA approval is anticipated in 2021.
Top reason why I might consider selling in the future: A lack of FDA approval.
$RDFN – Redfin - Market Cap of $7B
Profile: Online real estate ecosystem and iBuying
Risk: Low risk –> full service real estate platform, housing boom
Quick stats: Rev Growth -1%, P/S 8, 50-MA +29%, CR 2.4, Glassdoor 80%
Tailwinds: Migration to rural/suburbs, housing boom, iBuying
Key 2021 headwind: Cannibalization of real estate agents with iBuying
Top reason why I might consider selling in the future: None at the moment.
$SE – Sea Limited – Market Cap of $101B
Profile: SE Asia ecommerce, payments, and gaming
Risk: Medium risk –> Chinese competition
Quick stats: Rev Growth YoY 99%, P/S 29, 50-MA +10%, CR 1.5, Glassdoor N/A
Tailwinds: Gaming growth, e-commerce, underbanked population
Key 2021 headwind: Chinese conglomerate competition
Top reason why I might consider selling in the future: None at the moment.
$SPOT – Spotify – Market Cap of $59B
Profile: Music streaming and podcasts
Risk: Low risk –> music streaming leader, diversification to podcasts
Quick stats: Rev Growth YoY 13%, P/S 6.4, 50-MA +9%, CR .9, Glassdoor 92%
Tailwinds: Reopening for concerts increases advertising spend, podcasts, international expansion
Key 2021 headwind: Music conglomerates pricing power
Top reason why I might consider selling in the future: If one of the three groups that control most music rights (Sony Music, Universal Music Group, and Warner Music Group) pulls their music from Spotify.
$TDOC – Teladoc Health – Market Cap of $29B
Profile: Virtual and preventative care
Risk: Low risk –> virtual care leader, creating synergies from acquisitions
Quick stats: Rev Growth YoY 90%, P/S 34, 50-MA +1%, CR 6.5, Glassdoor 95%
Tailwinds: Need for preventative care, access to healthcare, digitization of health
Key 2021 headwind: Synergy of acquisitions
Top reason why I might consider selling in the future: None at the moment.
$U – Unity Technologies – Market Cap of $42B
Profile: 3D development platform
Risk: Medium risk –> high valuation
Quick stats: Rev Growth 53%, P/S 60, 50-MA +19%, CR 5, Glassdoor 92%
Tailwinds: Gaming boom, infrastructure optionality, growth in 3D applications
Key 2021 headwind: High valuation
Top reason why I might consider selling in the future: None at the moment.
$ULTA – Ulta Beauty – Market Cap of $16B
Profile: Omnichannel health and beauty
Risk: Low risk –> US health and beauty leader, strong financial health
Quick stats: Growth -9%, P/S 2.6, 50-MA +12%, CR 1.8, Glassdoor 83%
Tailwinds: Reopening, agreement with Target, international expansion
Key 2021 headwind: Recession recovery
Top reason why I might consider selling in the future: None at the moment.
Industry Trends for the Next Decade or More
Over the last year, I have begun to focus my investing on industry trends where I see a tremendous amount of growth/innovation/disruption occurring. This could be a new industry or this could be a legacy industry that is ripe for disruption.
Here are the industries I will be focusing on over the coming years for my investments. picking companies that take advantage of the growth/innovation/disruption:
E-marketplaces -> Marketplaces continue to be the central hub of our economies, and they are moving online. Online sales accounted for 16% of total sales in 2019. 2020 saw a sizeable increase, but there is still a long runway.
Cloud business services -> The day of buying a software package is over. Everything is a subscription, and everything is conducted through the cloud.
Entertainment -> In whatever form, people like to be entertained, and this will continue in the future.
Health and wellness technology -> The health world will hyper-focus on preventative care and attend to health and wellness needs when and where the customer needs it through technology.
Fintech -> Creating more efficient ways for consumers to make purchases, businesses to receive funds, and the underbanked portion of the world to have access.
Consumer goods -> New products that fill a market need.
Advertising technology -> The advertising world is going digital, so placing the right ads on the right devices at the right time will be key.
Digital security -> With everything moving online, security will be of utmost importance.
Electric vehicles -> Companies are setting carbon neutral/zero target dates, the public is demanding electric vehicles to minimize their environmental impact, and governments are requiring industries to go entirely electric by a set date.
Cannabis -> States have slowly been ratifying the use of medicinal and recreational cannabis.
Sports betting/Competitive gaming -> As with cannabis, states have slowly been passing sports betting laws. Another aspect of this will be the idea of competitive gaming, where players pay money to compete against each other, winning money if they win the competition.
These are not the only industries seeing growth, but these are the ones I am focusing on and the current reasons why. I will continue to research each one, along with the innovative companies that are taking advantage of the opportunities.
Thank You!
If you’ve made it this far, then you are an amazing human. Let me know what you think by leaving a comment. Or drop me a question. Share it with others who you think might appreciate the information. Looking forward to sending out the next issue!
**I am not a financial advisor, so please don't buy/sell anything based solely on what you read here and do your own due diligence.