You’ve always been interested in investing, and specifically, investing in tech stocks. The world is moving faster than ever, and new developments are making record profits for tech companies. One aspect of the tech sector that you’ve probably heard about is cloud computing.
By investing in cloud computing, you are getting involved in an industry that is exciting, profitable, and only set to expand over the next decade or so. The cloud computing revolution has affected all types of businesses, whether they are small or enterprise or B2B or B2C. It has also provided a great service to individuals who want to reap the same benefits as businesses. There are major players on board that is creating cloud computing technology and making a lot of money off it.
Before researching which tech stocks to invest in, first learn about exactly what cloud computing is, why you should invest in cloud companies and how to go about finding the best investments for you. Once you pinpoint the top tech stocks to pursue, you’re going to start building true wealth for you and your family now and in the future.
What Is Cloud Computing?
You may have heard of cloud computing, but you don’t how exactly what it means and how it relates to tech stocks. Cloud computing involves delivering computing services like storage, servers, software, analytics, networking, databases, and intelligence over the Internet, or the cloud, to provide “faster innovation, flexible resources, and economies of scale,” according to Microsoft, a cloud computing giant.
The benefits of cloud computing include its cost – companies don’t have to purchase datacenters, hardware, and software – as well as speed, since it is much faster than hardware. Since storage is unlimited and you don’t need physical space to operate within the cloud, companies can also easily scale up globally.
Cloud providers usually offer top-notch security to go along with their services, which protects companies’ information from potential hacks. When using cloud computing, companies can ramp up much more quickly than they could if they were using traditional hardware, software, and datacenters so the cloud increases productivity as well. Lastly, performance is improved with cloud computing since companies gain access to a global network of datacenters through their cloud providers.
The three types of clouds are public, private, and hybrid clouds. The public cloud can be accessed via a web browser, and the cloud provider owns all the hardware, software, and other infrastructure necessary to run it. The private cloud will be located at a company’s datacenter, usually on-site. Companies may also access a private cloud through a third-party provider. All services and infrastructure are on a private network. A hybrid cloud is a flexible version that lets companies move applications and data between private and public clouds.
Now that you know what cloud computing entails, here are the reasons why you should look into buying tech stocks from cloud companies.
1. Major Companies Are Investing in Cloud Computing
Aside from Microsoft, which is one of big blue-chip tech stocks, other major companies are providing cloud computing services. They include Amazon, Apple, Salesforce, Adobe, Oracle, Google, IBM, Cisco, and SAP. All of these companies provide their own versions of the cloud and have made astounding profits off their cloud computing services.
The top provider of cloud services in terms of market share is Amazon. Microsoft comes in second, and the other large providers are Google, IBM, SAP, and Oracle.
When you’re looking at tech stocks to invest in, consider these cloud providers. Remember to research their earnings report and stock price history (through Nasdaq.com), and to keep up with company news to ensure you’ve made a good investment.
2. Companies Are Making Huge Profits
Cloud computing is big business, and it’s bringing in huge profits for cloud providers. Overall, the global cloud computing market is valued at over $200 billion, and it expanded to more than 20% in 2019. In 2015, profits from the cloud computing industry were $75 billion.
In Q2 of 2018, Amazon Web Services made up 55% of the company’s operating profit. Just one quarter earlier, it made up 40% of the profits, which was a 26% jump from three years prior. In 2018, enterprise adoption of Microsoft’s cloud computing service, Azure, increased from 43% to 58%. Also in 2018, enterprise-cloud revenue for Microsoft was at $28.3 billion.
IBM brought in an estimated $20.1 billion, Salesforce made $12.2 billion, Oracle made $6.4 billion, and Google brought in $4.5 billion. In 2017, Apple made $30 billion with its cloud platform, iCloud.
All of this revenue is contributing to the stability and profitability of these tech stocks, which is why it’s a good idea to invest in them.
3. The Industry is Growing Fast
The cloud computing industry has been quickly accelerating over the past few years, as evidenced by the jump in profits of $75 billion to $200 billion. Fortunately, if you’re going to invest in tech stocks, cloud computing is a solid bet because this industry is not set to slow down any time soon.
According to one statistic, global IT investment in private clouds will reach $24 billion annually by 2021. This is nearly a 70% increase from 2016. The public cloud services market is predicted to increase by 173% in 2019. With a compound annual growth rate of 19%, the cloud computing industry is expected to be valued at $522 billion by 2026.
According to ARK Investment Management analyst James Wang, most companies, including those in the health care and banking industries, are going to end up investing in the hybrid cloud. One survey showed that 47% of companies use the hybrid model, while 30% used the public cloud and 23% used the private one.
How to Invest in Cloud Computing and Tech Stocks
Once you’ve done your research on the cloud computing companies, it’s time to invest. You can invest with as little as $500, though that won’t buy you much, considering that blue-chip companies often trade for more than that per share. Amazon is currently around $1,700 per share, for instance. You could only buy one share of Adobe stock with $500 and maybe four shares of Microsoft. If you’re going to buy shares of these companies, you’ll want to save up at least a few thousand dollars first.
Once you’ve saved up and your ready to invest, learn whether these companies pay dividends, or a certain percentage of your stock, to shareholders. Dividends can add to your income and be a nice little bonus for investing in a company.
Then, sign up for a trading platform where you can purchase the tech stocks. There are many available out there, and the top ones include E*TRADE, which charges $6.95 per trade, Ally, which is $4.95 per trade, and TradeStation, which is $5 per trade. Each one of these platforms will provide you with stock charts, market analysis, and other research tools that you’ll find valuable as you become a more experienced tech stocks trader.
Learning More About Tech Stocks Through Nova-X Report
To become well-versed in buying cloud computing and tech stocks, make sure you sign up for Nova-X Report. This report, from Money Map Press, is a subscription-based newsletter that gives you all the fascinating information you need to know about investing in tech stocks.
Michael Robinson, who sat in on early meetings for the cloud computing industry, writes and sends out the newsletter. His mission is to unlock $7 trillion in new-high tech wealth by dispersing expert knowledge to his readers. Along with the cloud, he touches upon topics like biotechnology, big data, sensors, Silicon Valley companies, and much more.
As someone who is new to tech stocks and the tech world in general, you may be confused about the various terms and technologies. Robinson breaks it all down for you in easy to understand language and shows you just how much you can make – and how you can build true wealth – by being an early investor with exhilarating new technology.
Are you ready to invest in groundbreaking technologies that will revolutionize the world? Get in on the excitement and sign up for Nova-X Report today. You won’t regret it.