Three Technologically Innovative Shares with Potential to Transform Your Wealth into Millions
Throughout the years, the most lucrative tech stocks in the market have delivered significant returns for their long-term investors. For instance, investing $10,000 in AI chip giant Nvidia a decade ago would now be worth around $2,900,000 with dividends reinvested. Similarly, an initial investment of $20,000 in its competitor Advanced Micro Devices (AMD) has grown to approximately $1,000,000. However, duplicating these impressive gains in the upcoming decade might prove to be challenging for these companies.
If you're hunting for budding tech stocks with the potential to generate wealth in the coming years, consider investigating lesser-known, rapidly growing companies that have yet to garner significant attention. I believe AppLovin (APP), Opera Limited (OPRA), and Datadog (DDOG) fit this description.
1. AppLovin
AppLovin not only develops its own mobile games and applications but also provides AI-driven app monetization tools to other businesses. Despite 2022 revenue growth plateauing and posting a net loss, its challenges were mostly due to inflation, rising interest rates, and other adverse market conditions for digital advertising. Its $1.1 billion acquisition of MoPub from Twitter provided some organic growth, but these hurdles canceled out these gains.
However, in 2023, AppLovin's revenue surged by 17% and returned to profitability as the digital advertising market stabilized. At its Q3 2024 conference call this month, CEO Adam Foroughi reaffirmed his projection of achieving "20% to 30% year-over-year growth" for the coming years. Between 2023 and 2026, analysts expect its revenue to increase at an annual compound growth rate (CAGR) of 24%, with its earnings per share (EPS) rising at a CAGR of 91%.
Lower interest rates, a favorable macroenvironment, and the growing adoption of its AI-powered AXON ad discovery services should contribute to this robust growth. With these optimistic forecasts, AppLovin's stock appears reasonably priced at 43 times forward earnings and may yield millionaire-making returns over the next decade if it maintains its current trajectory.
2. Opera
Opera's primary product is a mobile and desktop web browser, serving about 2% of the global web browser market according to StatCounter. Despite lower user growth due to competition from larger browsers like Google Chrome, Safari, and Edge, it boosts its revenue via advanced AI tools and integrated ads. This strategy resulted in a 20% revenue increase and a 38% increase in adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) in 2023.
Its latest browser, Opera One, incorporates OpenAI's generative AI tools with its integrated AI assistant, Aria. These new AI-driven services have the potential to strengthen its existing user base and differentiate Opera from popular browsers. Between 2023 and 2026, analysts expect its revenue to grow at an annual CAGR of 17% and its adjusted EBITDA at a CAGR of 20%.
Opera's stock is currently valued at just 11 times its 2024 adjusted EBITDA, with a surprising 4.5% dividend yield. As it expands its ecosystem, reinforces its moat, and explores fresh monetization opportunities, its valuation could increase, resulting in substantial returns over the coming decade.
3. Datadog
Datadog collects diagnostic data from various computing platforms, presenting it on its unified dashboards. Its AI assistant, Bits AI, simplifies the data-sifting process for IT professionals, enabling them to quickly identify and resolve hardware and software issues. This unique service has resulted in a near-fourfold increase in its number of large clients (providing an annual revenue of over $100,000) from 858 in 2019 to 3,190 in 2023.
The company's revenue grew by 27% in 2023, marking its slowest growth rate since its IPO in 2019. Despite posting its first profit that year, it faced revenue retention challenges and high operating expenses. Datadog projects 25% revenue growth in 2024. From 2023 to 2026, analysts anticipate its revenue and EPS to grow at annual CAGRs of 23% and 80%, respectively. The stock might not be a bargain at 63 times forward adjusted earnings, but it has room for growth as the IT observability market expands. With the potential for at least 20% annual revenue growth for an extended period, Datadog has the potential to generate substantial returns and mint new millionaires in the future.
- To diversify your investment portfolio and potentially reap significant returns in the future, you might want to consider investing in Datadog. With its AI-powered data collection and analysis tools, the company has seen a significant increase in its large client base and is projected to experience robust growth in revenue and earnings per share over the next decade.
- If you're looking for a potential finance opportunity in the tech sector, Opera's stock could be an attractive option. While it faces competition from larger browsers, its integration of advanced AI tools and ads has resulted in revenue growth and increased profitability. Analysts expect Opera's revenue and adjusted EBITDA to continue growing at appealing rates, making its current stock price and dividend yield worth considering for long-term investors.
