Why is everyone so hyped up about Microsoft? Is it time to sell your Alphabet shares?
Today, we’re going to have a look at our Top Stocks for March 2023. We’ll also briefly touch on Tesla’s Investor day and some of the news around ChatGPT, but we’ve got a lot to cover, so we’re not going in-depth. If there’s enough interest, we can also do a deep dive from the long-term investment point of view, so if you’d like to see that, let us know in the comments below.
Now, without further ado, let’s get started.
Today, we’re taking a look at seven top stocks for March 2023. As usual, our list is mostly tech, with a bit of energy here and there for good measure. And, if you read until the end, we also have a special bonus stock for you.
We’re kicking things off with the usual suspects, and at number one, we’ve got…
Apple (AAPL)
- Current Price: $155.55 ((today change: +4.52(+2.99%))
- Market Cap: 2.463T
- PE Ratio: 25.44
- EPS: 6.12
Apple, ticker symbol AAPL, is the largest stock in the S&P 500 and NASDAQ. They’re well-diversified, have an incredible brand presence, and are known for quality products. And, as if that wasn’t enough last year, Apple only dropped by about 26%, while the rest of the tech sector index went crashing down by an average of 40%.
We like Apple because we love solid long-term investments. We love to buy and hold forever. And, we naturally keep a close eye on Buffett’s Berkshire Hathaway. Coincidentally, Apple shares make up a massive portion of the portfolio. And, when Apple dipped last year, Buffett didn’t hesitate to grab even more shares.
Essentially, Apple is a “default” pick for us – if there’s an opportunity to get reasonably priced shares, we’re not going to miss out.
Tim Cook’s pronounced interest in Augmented Reality is an interesting note that gives us even more faith in Apple. The AR market is expected to grow to about $600 billion in 2030. Like with most digital innovations, there will probably be a massive surge in user interest as soon as the tech becomes more advanced and accessible. Basically, what we’ve got here is “next level” diversification – something that might just revolutionise how people use tech, similar to what smartphones did when they first came out. And Apple is primed to take advantage of this shift.
We can’t really talk about tech stocks without mentioning…
Alphabet Inc. Google (GOOG)
- Current Price: $95.99 ((today change: +1.97(+2.10%))
- Market Cap: 1.227T
- PE Ratio: 20.21
- EPS: 4.75
The world’s most popular search engine and cloud service provider once again made it to our top list. Which should come as no surprise. Between the Ads, Google Search, Gmail, YouTube and the cloud services, their long-term prospects are excellent as always.
Yes, there’s been chatter about the rise of ChatGPT and Bing snatching their market share. This prompted Google to launch its own chatbot before it was ready. So naturally, many less-experienced investors panicked and started selling shares. And you clearly see the timeframe when you look at the chart. However, this is not a bad thing from where we’re standing. Why? Because, as usual, we’re looking to be greedy when others are fearful, of course.
Now, don’t get us wrong here – we absolutely believe that AI will become a big thing in the future. Maybe even in the foreseeable future. What all of the doom and gloom people seem to miss here is that Google is a brand. It’s a massive company that offers hundreds of services to billions of people worldwide. For many of these people, “Google” and “the internet” are one and the same. It’s not like Google will just turn to nothing overnight. Their incredible brand presence and wide range of services will give them enough time to improve their own AI. The way we see things, it’s not about “if” Google can implement an advanced solution, but “when”. They absolutely have the people, talent, and resources to achieve this.
What we see here is not a reason for fear but an opportunity to grab more shares for cheap.
Moving on to number three, it’s time to take a look at…
Microsoft (MSFT)
- Current Price: $259.06 ((today change: +3.77(+1.48%))
- Market Cap: 1.928T
- PE Ratio: 27.80
- EPS: 9.32
So, why is Microsoft so popular all of a sudden? Well, it’s a really solid, well-established company with a great brand presence; their products are used in most office environments, they’ve got good numbers, and low new debt vs market cap… And then there’s ChatGPT.
And that last one is what really got investors so fired up about MSFT recently. And we get it; we really do. AI is a fascinating subject, and it’s got incredible potential. It can absolutely revolutionise a lot of fields. When it’s ready. But we’re not there just yet. Conversely, the developers are already working on the next version, GPT-4, which is expected to offer an even more refined experience.
So, no, we’re not going to invest in Microsoft because we got swept up in the hype. We’re going to invest in Microsoft because we follow our mantra – good fundamentals, good management, and good numbers. And, guess what – MSFT has all of that and more. So ChatGPT is just icing on the cake.
For our next stock, we’ve got…
Meta (META)
- Current Price: $187.40 ((today change: +2.15(+1.16%))
- Market Cap: 485.861B
- PE Ratio: 19.96
- EPS: 9.39
Meta Platforms, ticker symbol META, is our next solid pick for this March. And while Facebook is losing popularity with younger audiences, WhatsApp, and particularly Instagram, are doing excellent. In other words, META has something for everyone. And that’s precisely why we believe it to be such a strong pick in the long run. They’re well-diversified in the field and actively working to incorporate innovative technologies to attract new users. The Metaverse project is still in development, but once it comes out, it’ll revolutionise how we see online interactions. And if people can get so hyped about an advanced chatbot, just wait until they get a taste of what the Metaverse can do. But that’s still in the undetermined “when it’s done” future.
For now, when we look at Meta, we see brand presence, stability, and reliability, backed up by a lot of promise and good diversification.
For us, META is always a buy when the price is right.
Tesla (TSLA)
- Current Price: $195.09 ((today change: -2.70(-1.37%))
- Market Cap: 617.098B
- PE Ratio: 56.04
- EPS: 3.48
Once again, no surprise here – Tesla has been a long-time favourite for us. And despite the decline last December and all the social media drama surrounding Musk, the business itself is still incredible and there’s massive growth potential. And ultimately, that’s what matters to us investors – the numbers and the potential.
So, let’s talk numbers:
- This February, Tesla sold over 74 000 China-made vehicles. Or 74 402, to be exact. That’s an increase of 31.65% since last year (and a 12.6% up from January).
- Tesla’s new EV plant – the Nuevo Leon factory, is planned to be about twice the size of Mexico City’s airport. There, they’ll be producing their “next-gen” vehicles.
- EV sales in Australia hit 6.8% of all new car sales for February (5932 out of 88878). 3516 of those vehicles came from Tesla.
Additionally, on Investor day, Tesla announced that
- Full-year deliveries for 2022 are sitting at about 1.31 million EVs
- They expect to be able to produce “20 million EVs per year by 2030” as per the last investor day presentation.
- Musk is trying to cut costs to boost sales (and it’s working)
It’s worth noting that this is an incredibly long play, and everyone interested in owning Tesla shares must keep it in mind. Their products have the potential to revolutionise the entire sector, but the tech itself is in its infancy. EVs are still far from affordable for the average consumer, and the batteries are far from their true potential. Of course, this doesn’t mean that someone else can’t beat Tesla to the punch and come up with something better and more cost-efficient – they’re just the best choice for us right now. And they’ve got the numbers to prove it.
Next up, we’ve got…
Exxon Mobil (XOM)
- Current Price: $113.07 ((today change:+0.26 (+0.23%))
- Market Cap: 460.387B
- PE Ratio: 8.38
- EPS: 13.49
Exxon Mobil Corp., ticker symbol XOM, is an American multinational oil and gas company and one of the descendants of Standard Oil. We have yet to talk about it much on this channel because we generally prefer to look at the greener side of things, but from a business and investing standpoint, this company is really well-off. It’s ranked as one of the world’s largest companies by revenue – in 2022, Exxon Mobil got sixth place in Fortune 500’s list and 12th in Fortune Global 500. It is also the world’s largest investor-owned company in the west. They produce around 3% of the world’s oil and 2% of the energy.
The numbers
For 2022, XOM showed some incredible results:
- $56 billion in earnings ($13 billion of which was in Q4)
- $77 billion in cash flow from operations
- 87% shareholder returns
- 25% return on capital employed
- 5% reduction in net debt
And, while we’re all about a sustainable future, outdated energy will be around for a while. The simple fact is the infrastructure needs to be ready for a swap on a global scale, and neither are the consumers. So, companies like XOM are here to stay, and there’s good reason to believe they’ll stick around for quite a few years.
And, speaking of energy, it’s time to take a look at …
Nextera energy (NEP)
- Current Price: $67.30 ((today change:+0.72 (+1.08%))
- Market Cap: 5.824B
- PE Ratio: 11.74
- EPS: 5.73
NextEra Energy Partners, ticker symbol NEP, is another contender on the energy list, and a subsidiary of the global leader in wind and solar power production NextEra Energy. Currently, NEP owns about 6GW of wind (58%) and solar assets (21%), along with a number of natural gas pipelines (21%). They’re (mostly) green, stable, reliable, and future-oriented, and support a reliable dividend. In other words – a great long-term investment target, especially if you’re looking for solid dividends (expected to increase by 12-15% year-over-year through at least 2024).
NEP is well-funded and benefits from priority access thanks to its parent company, allowing it to grow and further diversify its already sizable portfolio. It’s important to note that the things we mentioned about Tesla also apply here. The projects for renewable energy are already underway, but the execution will take a considerable amount of time. For example, the US aims to increase its solar capacity by 18-20 GW per year for the 2023-2030 period (up from 10 GW for 2019-2022) and wind by 12-15 GW (up from 10). While necessary, this will be a massive (and quite expensive) transformation. And companies like NEP are going to be at the forefront of it.
And, finally, for our Bonus Stock and consider one of the top stocks for March 2023, we’ve got…
Trade Desk (TTD)
- Current Price: $58.19 ((today change:+0.90 (+1.57%))
- Market Cap: 28.559B
- PE Ratio: 529.00
- EPS: 0.11
Trade Desk, ticker symbol TTD, is an American marketing company allowing its customers to create and optimise Ads and Ad campaigns. Think social media ad campaigns and search engine advertisements.
Since IPOing way back in 2016, TTD has been up more than 1800% and keeps growing. Last quarter’s report shows a 31% in revenue year-over-year. A decent portion of their earnings goes right back into the business, allowing them to increase their coverage, improve user experience and add even more features to their platform.
Primarily used by digital marketers and business owners, TTD’s ad creation suite allows you to create the perfect ad, plan your campaigns and spread your message across the most suitable platforms from the ground up. All of this comes bunched up with advanced algorithms, extensive tracking data, and all metrics a marketer can dream of. The company has 4.3/5 stars on Glassdoor, and CEO Jeff Green’s approval rating is sitting at an impressive 95%.
And that’s about it for our top stocks in March. In closing, we’d like to highlight yet again that this is a long-term investment channel. While we might feature a surprising choice here and there, we’re not interested in “making some quick cash”. We’d rather own shares that we can comfortably hold on to forever. So, we’re looking for big, reliable companies – reputable businesses with a solid track record that are proven to bring results over the long term. So, all of our choices are based on these factors. ChatGPT is exciting, and yes, the Metaverse will revolutionise social media. But this is the future potential. We’re interested in the cold, reliable numbers. And, when it comes to the long game, we believe that this is what makes a truly winning strategy. Of course, we’re not financial advisers either, so, ultimately, it’s just our opinion.
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Thank you all for being with us today and until next time!
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Recommended books for further reading:
- Smarter Investing: Simpler Decisions for Better Results
- How to Make Money in Stocks: A Winning System In Good Times And Bad
- The Barefoot Investor: The Only Money Guide You’ll Ever Need
- The Five Rules Successful Stock Investing: Morningstar’s Guide to Building Wealth and Winning in the Market
- Investing QuickStart Guide: The Simplified Beginner’s Guide to Successfully Navigating the Stock Market, Growing Your Wealth & Creating a Secure Financial Future
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