3 disruptive stocks we love for Valentine’s Day


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A couple kissing digitally with 2 cell phones.

3 disruptive stocks we love for Valentine’s Day

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It’s only February, but many investors may feel like they’ve seen volatility all year.technology-centric Nasdaq 100 The index is down 11% so far this year, with many individual tech stocks mired in a bear market.

But redemption could be on the cards, and the earnings season boosted the broader market after some impressive early results.This month’s Valentine’s Day most welcomes positive shifts, according to three Motley Fool contributors break off ( 0.82% ), Nujiang Holdings ( NU -2.02% ), and Netflix (NFLX 0.20%) was the best performing stock.

A couple kissing digitally with 2 cell phones.

Image credit: Getty Images.

A Unique View of the Metaverse

Anthony Di Pizzio (Snap): Changes to privacy rules by tech giants Apple and letter One of the biggest stories in social media circles in 2021. It allows users to opt out of being tracked on their devices, an important method of collecting data for companies like Snap to sell ads to businesses. But after reporting its full-year 2021 results on Feb. 3, it was clear the company had found an alternative solution.

Snap reported full-year revenue of a record $4.1 billion, and the fourth quarter was its first profitable quarter on a GAAP basis. The results sent the company’s shares soaring 54% from a low of $24.51 on Feb. 3 to where they are today. This is in stark contrast to Snap’s direct competitors, meta platformwhich has been crushed since reporting its own results and telling the market that privacy changes could cost $10 billion in 2022.

Snap added 54 million users in 2021, bringing its current total to an all-time high of 319 million. Analysts expect the company’s growth to continue in 2022, with revenue of $5.4 billion and a full-year EPS of $0.53, its first-ever positive annual earnings result.

But investors have another reason to be excited. The company is building its own virtual world, which involves combining the digital and physical worlds using augmented reality glasses, which it calls glasses. It’s different from the immersive, fully virtual worlds that companies like Meta are building, but Snap says its technology will facilitate human interaction and ultimately better well-being for users. It’s a great goal in an environment where social media companies are being questioned over the negative impact of their platforms.

With estimates that the Metaverse could be an $800 billion opportunity by 2024, Snap’s unique approach could yield some big results. Now may be the time for investors to get involved and, in the long run, get the best results.

Woman uses mobile phone for mobile online banking.

Image credit: Getty Images.

new force in banking

Jamie Louko (Nu Holdings): The Latin American fintech company hasn’t received any love since it went public in December 2021. It’s down 30% since then, but I think it’s something to appreciate this Valentine’s Day.

Only five banks in Brazil, Mexico and Colombia control a whopping 85 percent of banking revenue in those countries, and this lack of competition has resulted in little innovation and poor customer service over the past decade. In Brazil, for example, there are an average of 1,400 complaints against these banks per 1 million people. Nu is trying to change that by bringing innovation to the banking industry in Latin America.

The company has built a one-stop shop for everything a consumer might need — including checking accounts and insurance products — in Brazil, Mexico and Colombia. What’s more, Nubank is fully digital and its consumers can easily increase their financial presence. It also has a strong focus on customer service: in Brazil, its banking rivals receive only 19 percent of complaints per 1 million people.

With its competitive advantage, Nu is helping drive financial adoption in Latin America. It currently has 48 million customers and is adding an average of 2.1 million new users per month. With over 5 million users being first-time banking customers, Nu is becoming the home of the next generation of financial applications in the region.

This resulted in excellent financial performance. The company’s customer base has grown 110% annually over the past three years, and revenue for the first nine months of 2021 has grown 99% year over year.

With $2 billion on Nu’s balance sheet and a net loss ratio of just 9%, Nu’s lack of profitability isn’t a major issue. However, it faces competition. This company is a true David and Goliath story, and while it has been successful in the past, that doesn’t mean it will continue down that trajectory. Now that Nu is gaining momentum, the banking oligopoly that is hosting the show in Latin America could work together to kill the disruptor.

However, investors with a larger appetite for risk might consider sending some love to Nu. Its stated mission is to “fight complexity to empower people in their daily lives,” and I think that’s a goal that many investors can get behind.

A smiling couple lies on a sofa watching a movie, one flicking on a channel with a remote.

Image credit: Getty Images.

Netflix and Chill

Trevor Jennerway (Netflix): Streaming platforms continue to lure viewers away from pay TV by offering more convenient and (often) cheaper alternatives to cable and satellite TV. In fact, according to Kagan research, annual revenue for pay-TV providers will drop by $26 billion over the next four years as more consumers cut power. Streaming pioneer Netflix still dominates the industry.

In 2021, the company has 221.8 million users, up 9% from the previous year.That’s 92 million more than paying members walt disneyDisney+, which is the second most popular streaming service. Netflix’s growing library of original content is a big reason for its success.According to the data, in 2021, the company has 12 of the top 15 original streaming series Nelson. It owns 13 of the first 15 acquired streaming series.

As a result, Netflix has a large and highly engaged audience that generates a lot of data. The company relies on artificial intelligence to understand this data, gaining insights to improve content recommendations and production decisions. This creates a flywheel effect that results in more engaging programming over time.

Despite slowing subscriber growth, Netflix delivered relatively solid financial results in 2021. Revenue rose 19% to $29.7 billion, and the company demonstrated its pricing power by raising subscription fees, which boosted its operating margin by 3 percentage points to 21%. As a result, diluted earnings per share surged 85% to $11.24.

And it still has a lot of room for growth. Even in the U.S. — its largest and most widely penetrated market — Netflix still accounts for less than 10 percent of screen time. But that number should trend upward as more consumers cut ties with pay-TV providers. Currently trading at 6.3 times earnings (well below its five-year average of 9.1), now looks like a good time to buy a few shares.

This article represents the views of the author, who may disagree with the “official” recommendation position of the Motley Fool Advanced Consulting Services. We are diverse! Questioning investment arguments—even our own—can help us think critically about investing and make decisions that help us become smarter, happier, and wealthier.

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