2022 has been a difficult year for sharemarket investors. Stocks are down, inflation is up, and global instability is maybe higher than it’s ever been.
Zoom out though and the recurring theme we see is that stocks have historically moved up and to the right, over the long-term.
3 top US shares I would invest in with $10,000
With that long-term view in mind, below we look at 3 US stocks I would invest in with A$10,000.
Meta Platforms share price -61% YTD
Overview
Meta Platforms is the parent company of social media giant Facebook & Instagram, messaging platform Whatsapp, and the virtual reality company Meta (formerly Oculus). Despite its expansive reach, amid economic headwinds Meta has seen its advertising revenue decline while the company’s founder and CEO has faced backlash from investors for his US$10 billion metaverse project.
Why
Here are the things that gives me confidence in the long-term outlook for the stock:
- Meta remains one of the most dominant players in social media – in the second quarter of 2022 the company had 2.93 billion monthly active users – or 37% of the world’s population – active on the Facebook platform.
- From a valuation perspective, Meta trades at a significant discount to its big tech peers and as such, may be considered undervalued right now. META last traded at ~11x 2023 earnings, while Apple, which in Q3 booked revenue growth of just 2%, trades at ~22x 2023 earnings.
- Zuckerberg has the time, capital, and executive control to see his metaverse project through, which may represent a significant long-term opportunity for the company.
- Zuckerberg’s history as an operator and innovator shouldn’t be downplayed. It’s worth remembering that Zuckerberg built one of the most profitable advertising platforms in the world, second only to Alphabet. Meta also has the flexibility to pivot away from the Metaverse project or explore other opportunities given the US$44 billion cash pile the company has accumulated.
Analyst view
Meta has a Buy rating on average and an average analyst price target of US$208.80, according to data from Syfe.
Alphabet (Google) share price -31% YTD
Overview
Founded by Larry Page and Sergey Brin in 1988, Alphabet – formally Google – has grown to become one of the most dominant and profitable technology companies in the world. Alphabet currently operates across a number of different industries and sectors, including: software, primarily search, to which Google is far and away the most dominant player, cloud computing, media (Youtube), and hardware, including Android and other Google products, like the Google Home.
Why
Here are the things that gives me confidence in the long-term outlook for Alphabet:
- Despite economic headwinds, Google remains the market leader in search – commanding an 83% market share – according to Statista.
- Alphabet has a consistent long-term history of organic revenue and earnings growth and operates at incredibly high margins. In Q2 2022 Alphabet grew revenue by 13% to US$69.7 billion while maintaining a 28% operating margin.
- The company has a solid management team with an enviable track record. CEO Sundar Pichai has expanded Alphabet’s reach into areas like cloud computing, which remain backed by significant secular tailwinds. Pichai has also been quick to jump on key media trends, like short-form video content, with the company recently aggressively building out YouTube Shorts.
- Recent reports from inside Google also suggest that Pichai will take a disciplined approach to costs in the face of economic headwinds, in the last quarter telling employees ‘we shouldn’t always equate fun with money’.
Analyst view
Alphabet has a Buy rating on average and an average analyst price target of US$139.74, according to data from Syfe.
Amazon share price -32% YTD
Overview
Amazon operates across a number of broad industries, from e-commerce, cloud computing, advertising, media, and logistics. In 2021, Amazon’s founder and CEO Jeff Bezos stepped down from the top spot, handing the reins over to Andy Jassy, one of the key people behind Amazon’s cloud business – Amazon Web Services or AWS. Under Bezos’ leadership Amazon survived the early-2000s tech wreck, reinvented two industries, and has since its IPO seen its stock rise over 100,000%.
Why
Here are the things that gives me confidence in the long-term outlook of Amazon:
- While Amazon is most well known for its e-commerce business, it’s the company’s cloud business that likely represents Amazon’s largest growth opportunity. Not only does Amazon have a 33% market share of the global cloud infrastructure market, but the company has continued to grow its cloud business rapidly, rising 33% in Q2 to revenue of US$19.7 billion.
- Adding to the diversification of Amazon’s revenue profile is the company’s high-margin advertising business. Like cloud, Amazon’s ads business is growing rapidly: In 2021 the company saw this business arm increase its revenue 32%, to US$31.2 billion.
- Amazon has a track record of innovation – rewriting the rules of both the cloud and e-commerce industries. With CEO Andy Jassy at the helm – Amazon is well placed to continue to innovate over the long-term. One is left to wonder what industry Amazon might revolutionize next?
- Like Alphabet, reports have emerged in recent months that Amazon will be taking a disciplined approach to costs – from hiring freezes to shuttering its Fabric.com business. As recession fears mount, knowing that management can be prudent from a costs-perspective is paramount.
Analyst view
Amazon has a Buy rating on average and an average analyst price target of US$163.52, according to data from Syfe.
How to buy and invest in US shares in Australia
Whether you’re just getting started investing or just want to take things to the next level, with Syfe you can invest in over 10,000+ US stocks & ETFs, all from the palm of your hand.
Not only that, but when you invest with Syfe, you get FREE monthly stock trades, access to powerful features like recurring buys and fractional trading, as well as daily customer support. All of this means you can take advantage of new investment opportunities when they emerge, any time, any where.
To start investing in US shares with Syfe, follow these simple steps:
- Download our app & create a Syfe account or login to Syfe app on your mobile device
- Search for the stock you’re looking to invest in
- Tap ‘buy’ on the app screen
- Choose between ‘buy in dollars’, ‘but in shares’ or ‘Limit order’ then just slide to buy
- Confirm your order and monitor your stock investment
This article/webinar is brought to you by Syfe Australia Pty Ltd., CAR number 1295306 of Sanlam Private Wealth Pty Ltd (AFSL 337927). Disclaimer: Investing involves risk including the risk of losing your invested amount. We do not provide personalised advice or recommendations. Any information we provide is general advice and current at the time written. Please speak to your Financial or Tax adviser for personal advice. Any reference to an investment’s past or potential performance is not an indication of any specific outcome or profit.
