Investors in technology are always searching for the newest and greatest thing. But a wise investment can be in businesses that have already achieved success and made a name for themselves in their fields.

Smart investors have the chance to purchase two top-notch equities to keep for 2022 and a very long time after that. Shopify (SHOP -7.22%) and Alphabet (GOOG -2.27%) are the two major players in online shopping and digital advertising, respectively. Strong secular tailwinds in these two sectors might support growth over the long run.

Alphabet’s yearly revenues are getting close to $100 billion.

The world’s most powerful advertising firm, in my opinion, is Alphabet. It is the home of two of the most popular ad-supported programs, YouTube and Google Search. Google Search has a staggering 83% market share among search engines worldwide, according to Statista. Similarly, YouTube claims to have 2.6 billion active viewers per month. Naturally, advertisers follow customers, thus the popularity of these services has attracted advertisers attempting to influence consumer choices.

Alphabet’s revenue increased as a consequence, rising from $55.5 billion in 2013 to $257.6 billion in 2021. Over the same period, operating income climbed from $15.4 billion to $78.7 billion. The popularity of Alphabet has resulted in immediate and potential future riches. The amount spent by marketers worldwide in 2021 increased by 22.5% to $763 billion. It’s interesting to note that from 52.1% in 2019 to 64.4% in 2021, digital channels accounted for a larger percentage of expenditure. Due to the advantages that digital advertising provides over conventional forms of advertising, this trend is unlikely to change.

Shopify’s earnings have soared.

Similar to that, Shopify operates in a sector that is expected to expand. The firm, which grew as a result of the epidemic, aids retailers in establishing and enhancing their online sales channel. Although customers are willing to leave the home and shop in person, at least temporarily, Shopify’s growth has lately stalled. Longer term, a larger percentage of expenditure is moving online. In 2020, 14% of purchases made in the United States will be made online, according Statista. By 2025, that percentage is expected to increase to 22%.

Shopify receives a monthly fee from platform users who are retailers as well as a cut of their sales. Shopify will thus grow as more individuals spend money online. The trend has already caused Shopify’s sales to soar in recent years. By 2021, revenue had increased from $24 million in 2012 to $4.6 billion. After reporting an operational loss of $2 million in 2012, this assisted the business in turning a $269 million profit in 2021.

Stocks of Shopify and Alphabet are reasonably priced.

Thankfully, the shares of Shopify and Alphabet are not pricey for astute investors. Instead, they represent relative savings. When using this criteria, Shopify has seldom ever been less expensive at a price-to-sales ratio of 10. The price-to-sales ratio of six for Alphabet is below the historical average. Shopify and Alphabet are wise additions for those searching for solid investments.

Building wealth is similar to making a cake. It necessitates the appropriate elements, a suitable recipe (or strategy), and time to prepare. Even little investments may become a special treat if all of these factors are met. Nvidia is an instructive example. If you had purchased $3,000 worth of Nvidia stock ten years ago, that money would be worth over $147,000 today.

Given enough time, there are stocks today that could potentially return more than Nvidia. Let’s explore two of these companies.

1. Alphabet

Alphabet, the parent company of Google, is a huge force to be reckoned with. Its most well-known product – Google Search – is the leading search engine in the world, holding 84% of the market share.

Some of Alphabet’s key growth engines include YouTube and Google Cloud. These segments have helped the company achieve double-digit revenue growth year after year. In fact, over the last 12 months, Alphabet generated $278 billion in revenue.

Furthermore, Wall Street is optimistic about Alphabet’s future growth. Analysts anticipate the firm to bring in $324 billion in revenue by 2023, a 12% increase over this year.

Despite these benefits, Alphabet shares have been underperforming this year. The stock is down 16% so far this year. The poor first half of the year is one reason, as the Nasdaq Composite fell 30% in the first half of 2022.

Investors, however, may find opportunities in this recent decline. The price-to-earnings ratio for Alphabet shares is presently 22.6, significantly less than its three-year average of 28.3.

2. Airbnb

Airbnb (ABNB 0.71%) is a booking and reservation software that links travelers with accommodation providers. While the concept of Airbnb is not completely novel – connecting homeowners and renters – what sets the company apart is its passion for travel.

Airbnb’s app does not presume that visitors are familiar with their next destination or when they will leave. It is meant to pique one’s appetite like a restaurant menu on the street. Its algorithm illuminates listings with open booking dates that have been marked as favorites by users.

What is the result of this? Airbnb guests consistently discover more than a one-night vacation; they discover a long-term rental. Over 45% of nights that are booked on Airbnb are now part of a longer stay that lasts about seven nights. Stays that last 28 days or more accounted for nearly 19% of bookings.

That is good news for hosts, as those long-term rentals are beneficial. First, they provide a steady stream of income, and second, because there are fewer ‘resets’ between visits, hosts save time and money.

Analysts on Wall Street have a lot of faith in the company’s prospects. They anticipate Airbnb to make $8.3 billion in revenue this year, up 38% from 2021. Additionally, they anticipate revenues to reach $9.5 billion by 2023.

The stock’s price-to-sales ratio, or P/S ratio, is 11. This may seem high, but since Airbnb went public in late 2020, its typical P/S ratio is 20.5. Furthermore, the stock has dropped 26% thus far this year, providing investors a great chance to buy shares on the cheap.

Apple, Microsoft, Alphabet, and Amazon are the only four companies with a market capitalization of $1 trillion or more in the United States. Tesla is also close behind at $907 billion.

These are businesses that have delivered amazing returns to their investors. It goes without saying that these firms had much smaller market capitalizations not long ago. Amazon’s market value was $105 billion exactly 10 years ago.

A good starting point for locating the next home-run stocks is businesses that are growing at a rapid speed and have a market capitalization of $100 billion to $500 billion. However, let’s look at Warren Buffett’s Berkshire Hathaway (BRK.A 1.66%) first, which has a higher market value but might be a good purchase right now.

If you’re looking for a better return, consider Advanced Micro Devices (AMD 2.76%). This one is a strong development story with years of growth ahead.

1. Berkshire Hathaway

Berkshire Hathaway is one of the most secure stocks to invest in for the long run. With a market value of $653 billion, it has appreciated 50% over the previous five years. That puts it within striking distance of the trillion-dollar mark. There are a few reasons for its continued rise in value.

Berkshire Hathaway’s balance sheet boasts $122 billion in cash and fixed securities. At the conclusion of the second quarter, the organization possessed a big stock portfolio worth $327 billion. Warren Buffett has a large investment vehicle that includes Apple, Bank of America, and Coca-Cola. Buffett has recently boosted his stakes in Chevron, Occidental Petroleum, and top PC maker HP (formerly Hewlett-Packard).

Berkshire Hathaway, in particular, has been one of Buffett’s best stock ideas in recent years. Buffett amassed $4 billion worth of the firm’s shares throughout the first half of 2022 – a signal that he thinks the stock is undervalued. The share price has more than tripled over the last decade, suggesting it may repeat that performance and push Berkshire Hathaway’s market capitalization past $1 trillion by 2032.

2. Advanced Micro Devices

In the long run, investing in technology-related companies that specialize in data centers, cloud computing, and other high-tech needs might pay off handsomely. AMD has established itself as a key provider of fast processors in these markets.

AMD’s forward price-to-earnings ratio of 23 is low, based on 2022 earnings expectations, and the firm has a market capitalization of $159 billion. To reach $1 trillion in ten years, the share price must rise at a compound annual rate of 20 percent. This chipmaker may make it happen.

For a long time, AMD was considered the underdog in the semiconductor sector. It’s always had to play the part of a low-cost alternative to Intel and Nvidia, but that isn’t the case anymore.

AMD has won over customers with its renewed emphasis on developing high-performance chips, despite the fact that it is still lagging far behind Intel in central processing units (CPUs) and Nvidia in graphics processing units (GPUs). Data center operators are increasingly considering AMD’s Epyc server chips as an alternative to Intel. In the last quarter, AMD gained market share over its CPU competitor. The firm’s data center chips and consumer chips for notebooks and gaming grew by 70% year over year in the second quarter, driven by strong sales growth.

AMD’s CEO, Lisa Su, is widely regarded as one of the most powerful corporate executives today. This underdog has made a remarkable transformation under Su’s leadership, and its best days are still ahead.

The Polygon (MATIC) blockchain has created a good reputation for itself in recent years, in part due to Ethereum’s (ETH) success. Polygon is an Ethereum Layer 2 scaling mechanism. This implies that Polygon improves the efficiency of Ethereum by reducing congestion and high traffic. Users flock to Polygon because it provides the decentralization and security of Ethereum while also allowing for faster speeds and reduced costs.

Polygon has a track record, and its future is what’s most fascinating. Even while the majority of cryptocurrencies are in a bear market, Polygon’s creators continue to develop new solutions to meet greater use cases.

zk-What?

Polygon’s most significant advancement is the zero-knowledge Ethereum Virtual Machine (zkEVM), which many consider to be the most important development in the field since Bitcoin.

Without starting to get too technical, zkEVMs help make Polygon more adaptable to support not only new smart contracts but also older smart contracts that were originally written on Ethereum. Developers will be able to move their ETH-based smart contracts over to Polygon’s blockchain without needing to rewrite any code with these zkEVMs. Developers may seek this option because Polygon offers cost savings and quicker speeds previously mentioned. Furthermore, a migration to Polygon does not negate the security and decentralization that are associated with the Ethereum network.

It is anticipated that the zkEVMs will be operational by early 2023. Timelines in crypto are notoriously unpredictable, as evidenced by Ethereum’s merge to proof of stake, which has been delayed numerous times; nevertheless, the zkEVMs may enable Polygon to achieve a new level of usefulness, making it worth waiting for a few months.

Polygon pairs with Meta

In the following few months, an increasing number of Polygon users could discover that it has a world of possibilities. Just a couple weeks ago, Meta CEO Mark Zuckerberg stated that Instagram will offer NFTs to users in more than 100 countries throughout Asia, Africa, the Middle East, and South America. The goal is for Flow (FLOW), Solana (SOL), Ethereum, and — last but not the least — Polygon to work with Instagram NFTs.

Users will be able to display and share their virtual assets with followers, instead of being a marketplace for purchasing NFTs. The pieces will include basic information such as the name of the work, the creator, and blockchain on which it was purchased.

This is without a doubt the most prominent moment Polygon NFTs have had. Now that Polygon has a presence in front of Instagram’s two billion users, more people may learn about its cheaper fees and quicker transaction times versus Ethereum.

Bitcoin is the obvious choice (BTC -1.42%) if there’s one crypto to invest in right now. There’s a major change in the investment industry right now, and it’s all because of Bitcoin. In early August, Coinbase announced that it had joined forces with BlackRock, the world’s largest asset manager (BLK 0.47%), to offer cryptocurrency investment services for wealthy private clients and big institutional investors. To put it another way, Bitcoin is no longer only suitable for the small guys.

Within hours of the news, Bitcoin price predictions reached as high as $773,000 (from about $24,000 today), according to The Sun. You’re catching on. It’s easy to see why the partnership between Coinbase and BlackRock is significant. In a nutshell, the collaboration agreement allows major institutional investors – such as mutual funds, pension funds, foundations and endowments – to invest in cryptocurrencies using a custody solution from Coinbase. There will be upward pressure on the Bitcoin price due to the large amount of money chasing it. Now is the time to get in; you don’t have much time left.

The Coinbase/BlackRock deal

Consider that Forbes said it was “$10 trillion earthquake,” since BlackRock manages $10 trillion in assets from some of the world’s most important investors. Even if you take a cautious approach, BlackRock clients will likely start to put a tiny portion (maybe 1%) of their assets into crypto. Even a little shift in allocation might be enough to send Bitcoin skyward. We’re dealing with enormous figures here. One percent of $10 trillion is $100 billion, and they’ll all be seeking a new home in the crypto world. To put it another way, today’s total market capitalization for Bitcoin is around $460 billion.

Yes, not all of that $100 billion will be spent on Bitcoin, but it’s a sure thing that investors will pay attention to the cryptocurrency. If big institutional investors truly do consider crypto to be a brand new, well-defined asset category, this will have a substantial influence on asset allocation. Traditional asset classes such as equities and bonds used to be important focuses for big institutional investors. However, in the 1990s, they began investing in riskier asset classes like real estate and private equity in order to enhance earnings and hedge overall market risk. That practice is continuing now with the introduction of bitcoin. These same investors are going to put a tiny portion of their portfolios into bitcoin, along with all of their other alternative investments. That’s why this is such a significant shift: Bitcoin will become more popular among the super-wealthy and large players in finance.

Because of this, we’re now in the golden era of Bitcoin buying. It will be much more difficult to obtain a good price once the major institutional investors realize they want to get involved in the Bitcoin market. This is not about “buying the dip” and hoping that Bitcoin goes up in value. This is about reacting to a significant shift in thinking currently taking place in the market. The easiest way to respond is by purchasing Bitcoin.

The technology sector has been among the top-performing sectors during the past month, behind only consumer discretionary stocks. Admittedly, despite the fact that the Nasdaq 100 index is still down 19% in 2022, when compared to a 13% drop in the Dow Jones Industrial Average, but nevertheless shows signs of life.

Tech stocks led the nearly a decade-and-a-half bull run prior to being frozen out at the end of last year as traders turned to what appeared to be more recession-proof names. But investors should put such short-term fluctuations aside and focus on the long term, because tech is so entrenched in today’s economy that it will ultimately win out.

Use these severe pullbacks to acquire stocks that were formerly out of reach, taking them up at a bargain and then holding on for ten years or more. The following pair of tech firms are examples of stocks you may own for decades to profit from having bought them early.

PayPal

PayPal Holdings (PYPL) is a payments company that could easily supplement your long-term tech holdings category. Its growth is accelerating, while the fintech sector is still in the early innings of its own ascent.

PayPal has been around for a long time (its IPO was in 2002), but the payments industry is still just getting started. Consumers are using the service more than ever before, according to PayPal. Payment volume increased 13 percent during the third quarter, reaching $340 billion, with Venmo accounting for $61.4 billion in payment volume. PayPal handled 5.5 billion payment transactions during the year, up from 5.4 billion transactions at the end of 2020.

PayPal is a de facto leader in digital payments and peer-to-peer money transfers, with a well-known brand that will remain an important player in the fintech market.

Alphabet

There’s a lot to pick on Google (GOOG -0.69%) (GOOGL -0.72%) for. But it’s difficult to make the case that there are few firms more important to the tech industry, or that it is so deeply woven into society’s social fabric. That alone establishes long-term investing as a reasonable course of action.

Google, of course, has a monopoly in internet search, with 91.5 percent market share. Google’s second-quarter search advertising revenue increased 13.5% to $40.6 billion, demonstrating that advertisers will continue to go where the consumers are.

Google isn’t the only source of income for Alphabet. With almost three times as many monthly visits as Wikipedia, YouTube is the world’s most popular website and generates $7.3 billion in revenue.

Google Cloud might be where Alphabet sees the most development in the future. It is the third largest cloud operation behind Amazon’s AWS and Microsoft Azure, with revenue increasing 36% to $6.3 billion during the second quarter.

Alphabet’s value has tumbled more than 20% this year, creating an attractive buying opportunity.