5 Stocks to Buy for a 2022 Economic Rebound

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The coronavirus pandemic wreaked havoc on the global economy in 2020 as businesses around the world shut down, cities went into lockdown, and social distancing became the norm.

Most economies turned a corner in 2021 as vaccines became available and many businesses reopened. But in many ways, 2021 has been very different from what experts had hoped for. 

On the one hand, new businesses are opening up at a rapid pace, and Americans are spending some of the money they saved during 2020. And yet, many companies have delayed bringing their employees back into the office, there are shortages for everything from computer chips to paint, and businesses of all sizes are struggling to find workers.

This has led some inventors to look to 2022 for a more complete economic rebound. If you’re wondering what stocks to buy when the economy looks more normal than it does right now, then check out the opportunities currently being created by the five companies below. 

5 Stocks to Buy for a 2022 Economic Rebound

  1. Shopify
  2. Amazon.com
  3. Roku
  4. Roblox Corporation
  5. Tesla

Shopify (NYSE: SHOP)

  • Shopify (NYSE:SHOP)
  • Price: $1346.55 (as of close Sep 29, 2021)
  • Market Cap: $168.504B

Shopify is one of the leading platforms for companies who want to build an e-commerce storefront. The company largely caters to small and medium-sized businesses, helping them set up online shops easily and scale them as they grow, but it also offers its Shopify Plus tier to larger corporations, with Allbirds, Heinz, and Staples Canada being customers. 

Why is an e-commerce platform perfectly positioned for a 2022 economic rebound? Because Shopify is successfully tapping into increasing demand for e-commerce stores.

Take a look at some of the company’s recent stats: 

  • Shopify has attracted 1.7 million businesses to its platform and the global pandemic helped accelerate the company’s already phenomenal growth from the previous years.
  • Total sales in the first half of 2021 jumped 78% from the first half of 2020. 

The company breaks its revenue into two categories: merchant solutions and subscriber solutions. Merchant solutions revenue mainly comes from the company’s payment processing service and in the first six months of 2021, sales from this segment spiked 82% from the first half of 2020. 

The company’s subscription solutions sales, which consists of monthly subscriptions to its platform, are booming as well and popped 70% in the first six months of 2021. 

And as impressive as all of this growth has been, there’s likely more potential for Shopify to continue growing. Consider that in mid-2021, just 12.5% of retail sales in the United States happened online. And that’s during a pandemic that’s still kept more people at home and shopping online than ever before. 

This means that there’s plenty more room for Shopify to grow as the e-commerce market continues to expand. We’re still in the early stages of e-commerce and Shopify has already built a leading e-commerce platform that’s poised to benefit as this market grows.  

Amazon.com (Nasdaq: AMZN) 

  • Amazon (NASDAQ:AMZN)
  • Price: $3301.12 (as of close Sep 29, 2021)
  • Market Cap: $1.672T

I know, I know—how can Amazon still be a top stock after the company’s 1,300% share price gains over the past decade? But trust me: this company is nowhere finished growing yet. 

Amazon is a massive company and it continues to deliver growth worthy of its size. Operating income increased from $9.8 billion in the first half of 2020 to $16.6 billion in the first six months of 2021.  

To understand how Amazon put up such impressive growth, let’s take a quick look at the company’s e-commerce business. Amazon’s North American sales spiked 22% in the first half of 2021 and its international revenue jumped 36%. Remember that we’re talking about a company with a market cap of $1.7 trillion, so a sales increase by this much is very impressive. 

Part of Amazon’s ongoing e-commerce growth is due to the company’s popular Amazon Prime service, which offers fast and free shipping, free video and music streaming, as well as other services. 

In mid-2019, Amazon had 150 million Amazon Prime members worldwide, but by mid-2021 that figure had jumped to 200 million. 

You may be wondering if Amazon has fully tapped out its e-commerce opportunity, but it’s worth keeping in mind that, just as with Shopify, the e-commerce market still makes up just a fraction of total U.S. retail sales. 

And finally, Amazon has other avenues of growth that don’t have anything to do with e-commerce. The company’s Amazon Web Services (AWS) cloud computing service is a key ingredient to the company’s future growth. 

Here’s a quick overview of Amazon’s impressive AWS position: 

  • AWS is the leader in the public cloud market with nearly 32% market share, outpacing Microsoft Azure’s 19% and Google Cloud’s 7% market share.
  • AWS is Amazon’s most profitable business and sales from this segment jumped 35% in the first half of 2021. 

Spending on the public cloud computing market is expected to increase over the next few years and reach $397 billion in 2022—up from $270 billion in 2020 according to research firm Gartner.

Roku (Nasdaq: ROKU) 

  • Roku (NASDAQ:ROKU)
  • Price: $302.92 (as of close Sep 29, 2021)
  • Market Cap: $40.425B

The video-streaming market has been completely turned upside by Roku. Yes, there were other ways to stream video content on your TV before Roku came along, but no other company has made it so easy.

The company made streaming content from your favorite service a cinch and now more than 55 million households are using its streaming devices and smart TVs embedded with its software. 

The beauty of Roku’s platform is that it benefits no matter which companies are currently winning the streaming wars. If Netflix’s shows are in demand, great. If Disney+ is gaining ground, fine. Roku wins either way. 

The company makes money by selling its devices, taking a cut from customers signing up for new streaming services while using its platform, and from advertising. Device sales will increasingly become less important to the company as its platform revenue and advertising sales increase, which is already happening. 

Here’s why Roku is a leader in the video streaming platform space: 

  • Roku’s platform revenue—which includes advertising, content distribution, and billing services—skyrocketed 109% in the first half of 2021, compared to 2020.
  • That massive jump helped the company’s total revenue spike 80% and helped operating profit more than double compared to the first six months of 2020. 
  • Roku’s users are spending more money on the platform and average revenue per user (ARPU) increased by 46% in the first six months of 2021, compared to the first two quarters of 2020 

And if all of that weren’t enough to convince you that Roku has become a dominant force in the video-streaming platform space, consider that the company is only just beginning to tap into its advertising opportunity. 

Roku said that its upfront advertising commitments more than doubled in 2021 compared to 2020 and that the number of new advertisers increased by 43%. 

Roku’s recipe for creating an easy-to-use, streaming-service-agnostic platform has been a massive success. And with the video streaming wars still well underway, investors shouldn’t overlook this platform leader.

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Roblox Corporation (NYSE: RBLX)

  • Roblox Corporation (NYSE:RBLX)
  • Price: $76.31 (as of close Sep 29, 2021)
  • Market Cap: $43.89B

Roblox isn’t a household name like many other companies on this list, but it deserves a spot because of its disruptive potential in the gaming industry. 

Roblox is a gaming platform that not only allows its users to play games but also provides a space for them to create them as well. This unique pairing of gameplay and creation has sparked a massive following in the gaming industry and has helped Roblox amass 43 million daily active users on average. 

The company has been successful in creating an environment where developers want to build new gaming experiences for other players, with more than 8 million developers having created 20 million gaming experiences to date. 

Revenue more than doubled in the first half of 2021 and users were engaged with the company’s platform for more than 9.7 billion hours in the second quarter of 2021 alone. 

Roblox is still a fairly new publicly traded company, having just gone public back in early 2021, so investors have a chance to buy this company while it’s just ramping up. And the opportunity could be huge as Roblox taps into the massive video game market that’s expected to be worth $293 billion by 2027, according to Global Industry Analysts. 

Tesla (Nasdaq: TSLA) 

  • Tesla (NASDAQ:TSLA)
  • Price: $781.31 (as of close Sep 29, 2021)
  • Market Cap: $773.509B

There’s no denying it now: the world is on the cusp of a massive shift to electric vehicles (EVs). Nearly every major automaker has revealed huge plans over the past year to add or expand plans for building EVs. 

Why the sudden interest in electric vehicles? You can thank Tesla for that. Sure, some might say that automakers are starting to build EVs because people are becoming more environmentally conscious (and they probably are), but automakers are really focusing their attention on EVs because they’ve seen Tesla become massively successful in the market.

The company’s automotive sales account for nearly 80% of all EVs sold in the United States, and in 2020 the company delivered an impressive 500,000 vehicles. 

And while the big automakers are working hard to catch up to Tesla, they’re probably going to have a harder time than they think. 

Consider that General Motors recently had to temporarily shut down the assembly plant of its Bolt EV and is recalling five years’ worth of models—141,000 vehicles—because of potential problems with the vehicle’s batteries. 

This is just a hiccup in GM’s long-term EV pursuits, but it proves that just because large automakers are turning their attention to EVs right now doesn’t mean they’ll be successful at overtaking Tesla. 

Another thing going for Tesla is that the company has above-average margins compared to many of its peers. That pricing power could increase even more in the coming years as Tesla introduces new vehicles and adds more features to its expanding EV lineup. 

EVs will account for more than one-quarter of all new vehicles sold worldwide in 2030, according to research firm IHS Markit. And by 2050, that percentage could skyrocket to as much as 82%! With Tesla already well ahead of its competitors, you can bet that the company will be the EV leader for years to come. 

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Chris Neiger has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon, Roblox Corporation, Roku, Shopify, and Tesla. The Motley Fool recommends the following options: long January 2022 $1,920 calls on Amazon, long January 2023 $1,140 calls on Shopify, short January 2022 $1,940 calls on Amazon, and short January 2023 $1,160 calls on Shopify. Millennial Money is part of The Motley Fool network. Millennial Money has a disclosure policy.

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