Cryptocurrency has gained popularity due to its non-reliance on any central authority such as a government or bank. However, this also increases its volatility and leaves many cryptocurrencies open to potential manipulation.
The recent performance of the most widely used crypto, Bitcoin, is a prime example of this. It has seen a high of $41,500 and a low of $15,800 over the last 12 months alone and is currently down 25% for the year.
On the other hand, tech stock growth is usually based on a company’s financial health and ability to increase earnings over multiple years. As a result, many tech companies offer reliable and consistent gains in the long run, and the industry’s focus on innovation offers more room for growth than the crypto market.
Here are three tech stocks with more potential than any cryptocurrency.
1. Advanced Micro Devices
Advanced Micro Devices (AMD 0.18%) stock has gained over 800% in the past five years and more than 3,700% in the past decade. The chipmaker has carved out a profitable position in multiple areas of tech. AMD chips can be found in a wide range of industries, from consumer products such as Sony‘s PlayStation 5 game console to data centers hosting cloud platforms like Microsoft‘s (MSFT 0.03%) Azure.
The tech giant’s broad reach has safeguarded its results, with its revenue increasing 44% in fiscal 2022 despite an economic downturn. The PC market experienced severe declines last year, but AMD’s less consumer-reliant segments kept its business profitable. In fact, its data center segment reported a 64% year-over-year rise in revenue, with operating income increasing 86% last year.
In addition, the potency of AMD’s chips gives it an advantage in high-growth markets such as artificial intelligence (AI) and virtual/augmented reality. As the tech industry progresses, demand for the company’s hardware will only increase, and AMD stands to benefit significantly, making its shares a better investment than any cryptocurrency.
Investing in companies active in markets with considerable growth potential is the key to long-term success in the tech sector. This strategy can protect your investment and offer more growth than crypto.
For instance, the e-commerce market is expected to reach a value of $4 trillion in 2023 and expand at a compound annual growth rate (CAGR) of 11.5% through 2027. Amazon‘s (AMZN 1.96%) dominance in this industry makes its stock a compelling option.
The company holds a 37.8% market share in online retail sales in the U.S. alone, with Walmart‘s 6.3% share coming in a distant second. Amazon’s prominence in the industry led to significant losses in 2022 as a rise in living costs caused a decrease in consumer spending. However, in the long term, the company is likely to benefit the most from the market’s recovery.
Amazon also holds the leading position in cloud services with Amazon Web Services. The company’s dominance in two high-growth markets is likely to help the stock soar in the coming years. Analysts give Amazon shares an average 12-month price target of $137 — or a 34% rise from current levels — showing Wall Street’s optimism.
As the second-largest company in terms of market capitalization at $2.1 trillion, it’s not shocking that Microsoft has more potential than any cryptocurrency. The company’s in-house brands like Windows, Office, Azure, and Xbox have granted it substantial market shares in various high-profit industries and given Microsoft the funds to invest in technologies of the future.
The company has featured in many headlines recently after its $1 billion investment in OpenAI, the developer of ChatGPT, in 2019 appears to have been the foresight of the decade. OpenAI stunned the tech industry last November with the release of ChatGPT and kicked off an AI race in which countless companies have shifted focus to developing the technology.
Microsoft is currently winning as its partnership with OpenAI and further investment of $10 billion have allowed it to integrate the company’s technologies across its various services. Microsoft has thus far enhanced its Office productivity software, cloud platform Azure, and search engine Bing with the start-up’s software.
If all goes to plan, Microsoft could attract millions of customers and businesses to its platforms, offering the best in AI services. Taking into account the AI market is anticipated to grow at a CAGR of 37.3% through 2030, the company is well-positioned to experience a surge in its stock.
As a result, Microsoft is a top stock, offering massive potential compared to any cryptocurrency on the market.
John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Dani Cook has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, Amazon.com, Bitcoin, Microsoft, and Walmart. The Motley Fool has a disclosure policy.