Top 3 tech stocks that can make you rich in retirement

This is an excellent market for most tech investors!

Yes, you read this statement correctly. It may seem a little detached from reality due to the performance technology stock over the past year. Certainly, the process also requires more patience and is more frustrating than during a bull market.

However, investors can get richer by picking stocks that beat the competition by outstripping them. Such concentration can lead to huge returns in Qualcomm (QCOM 0.62%)And the MercadoLibre (milli 4.21%)And the Shopify (a store 8.03%).

Qualcomm

Qualcomm has thrived for decades by leading the smartphone chip market, a market it continues to dominate. As the first manufacturer of 5G phone chips, its position in this market remains unparalleled.

Moreover, it has made plans for the day when many smartphone functions will migrate to other devices. Thus, it has increased its efficiencies in the IoT and Automotive sectors. The Internet of Things has flourished, because it provides that power deadOculus headphones. Also, its digital cockpit continues to grow rapidly, and will likely become even more important as vehicles become more autonomous.

However, it faces challenges that have led to a drop in the stock price. Slowing consumer spending has dampened growth in the smartphone business. Also, restrictions on chip sales to China have hurt the company, as it relies on that country for 65% of its revenue.

But in the midst of them Big ChallengesThe price-to-earnings ratio has been reduced to just nine times earnings. This is relatively low given the slow but respectable 22% revenue growth rate in the fourth quarter of the fiscal year (which ended September 25).

Additionally, Data Bridge Market Research expects a 49% compound annual growth rate (CAGR) for 5G chips. If true, then Qualcomm appears to be in a position to recover as more temporary difficulties recede.

MercadoLibre

MercadoLibre is much more than just e-commerce in Latin America. It has built synergies in both the tech and logistics business, giving it a massive moat in its home region.

Latin America is a cash-based society, which is a challenging factor for doing business online. To address this, I created a fintech division called Mercado Pago. The move made it a leader in the fintech space in Latin America, where it thrived further by offering the service to those who don’t buy from MercadoLibre.

Furthermore, because MercadoLibre can help e-retailers with logistical challenges, sellers have much less incentive to consider it. Amazon or other alternatives.

This may have helped MercadoLibre’s ecosystem avoid a slowing growth (at least for now). Its third-quarter revenue was $2.7 billion, up 61% from last year’s levels. Third-quarter earnings grew 36% to $129 million during the same period as a result of higher operating expense growth and higher income taxes.

However, analysts expect revenue growth to slow to 24% next year. And with the stock down more than 50% from its high, it’s not immune to a bear market. But with its competitive advantages and ability to grow as other tech peers stagnate, it could easily turn around as the market recovers.

Shopify

Like MercadoLibre, Shopify has stood out by working on a different plane than its competition. The e-commerce platform provider mainly competes with other software providers.

However, it has bypassed these peers by adding fintech, lending, inventory management, and other capabilities to its ecosystem. This allowed it to expand from its primary market of small and medium-sized businesses to serve large organizations through Shopify Plus.

Also, creating a fulfillment network provides a necessary component of e-commerce that its software-based competitors cannot or will not offer. The ability to meet this need can make Shopify the only acceptable option for many online sellers.

But despite its market power, Shopify stock has fallen more than 80% over the past year amid slowing growth and a bear market. Its third-quarter revenue of $1.4 billion was up 22% compared to the same quarter last year. Although respectable, it lags behind the three-year compound annual growth rate (CAGR) of 52%.

However, the company expects above-average gross merchandise volume and slower operating expense growth. Also, the price-to-price ratio has dropped to eight, near record lows. Given this assessment and the growth prospects for its robust ecosystem, it should present to investors over time.

John Mackie, CEO of Whole Foods Market, an Amazon company, is a member of The Motley Fool’s Board of Directors. Randy Zuckerberg, former director of market development and Facebook spokeswoman and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Will Healy He has positions at MercadoLibre, Qualcomm, and Shopify. Motley Fool has positions at Amazon, MercadoLibre, and Meta Platforms, Inc. , Qualcomm, and Shopify. Motley Fool recommends the following options: long January 2023 calls at $1,140 on Shopify and short January 2023 calls at $1,160 on Shopify. Motley Fool has a profile Disclosure Policy.

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