Tech Stocks: Shares of This Innovation Are Skyrocketing
Our world is moving quicker than ever before.
A couple of weeks ago, I wrote about E.M. Rogers’ “Diffusion of Innovation” theory. It lays out how a new technology moves from introduction to complete saturation.
But there’s another aspect of this theory that investors (and society in general) must come to terms with: Technology is being adopted more rapidly than ever before.
It used to take decades for a technological innovation to become a fixture in our lives. But as technology advanced and the world got smaller, the time frame of widespread adoption condensed.
Smartphones have been extremely popular for the past decade.
And apps on smartphones need mere days to reach 50 million users. This is where investors can continually tap into big returns in a variety of ways.
A $189 Billion-Plus Opportunity
The stats seem quite startling at first.
But I think they demonstrate how dependent we’ve become on a keystone innovation.
The average American checks their phone every 12 minutes.
A smaller percentage of the population – 10% – looks at their phone every four minutes.
This is part addiction, part necessity. Smartphones are our tether to family, friends, work, entertainment and the larger world.
Over the years, there have been few trends more profitable to play than smartphones.
Just ask any early Apple (Nasdaq: AAPL) investor.
And we’ve become even more reliant on our phones because of the pandemic. Targeting this trend is delivering massive gains.
Shares of Amazon (Nasdaq: AMZN), Apple, Etsy (Nasdaq: ETSY), Facebook (Nasdaq: FB) and a host of other tech companies littering our smartphone screens with their apps have rocketed to all-time highs this year.
If you didn’t shop from your phone before the global COVID-19 outbreak, you probably do by now. And if you did shop from the comfort of your smartphone before, chances are you’ve been shopping even more.
(I personally never realized how easy it is to order alcohol with my phone. And now I don’t know if I’ll ever step in a liquor store again.)
FaceTime, Skype and Zoom Video Communications (Nasdaq: ZM) calls give us a reason to put on pants, comb our hair and interact “face-to-face” with other human beings.
Video game companies are booming because we can’t stop playing games.
Breaking news is delivered to us through either news apps or tweets… Thank the ubiquitous Twitter (NYSE: TWTR) for that.
Mobile apps alone were projected to generate more than $189 billion in revenue this year. And that was before the pandemic began.
From 500 to 200 Billion
When Apple’s App Store launched a dozen years ago, it offered just 500 apps.
Today, there are more than 20 million registered iOS developers and more than 200 billion app downloads each year.
This is becoming somewhat of a problem for us.
During the 21 weeks of quarantine, everyone has been stuck at home staring at their phones and mobile devices.
And in unison, we’ve all come face-to-face with an uncomfortable conclusion: We all have a lot of apps.
On average, people have roughly 60 to 90 apps on their devices and use around 30 each month.
And over the past few months, the time we’ve spent on our phones has skyrocketed. Video chat time is up 350%, and social media use has tripled, as has the use of streaming platforms Netflix (Nasdaq: NFLX) and YouTube.
There are more than 3.5 million apps in the Google Play store. And businesses are in a constant struggle to drive traffic to their apps.
Well, one company has been in the right place at the right time – Digital Turbine (Nasdaq: APPS).
It’s an advertiser that helps companies reach new audiences and tap into new revenue streams with its mobile delivery platform.
This platform offers a setup wizard, dynamic and single-tap installs, smart folders, notifications, a media hub, and an open market.
It currently has partnerships with more than 40 app developers and original equipment manufacturers. These include household names like AT&T, Cricket, LG Electronics, Lyft, Panasonic, Samsung and Verizon.
More than 450 million devices have downloaded Digital Turbine’s software. And roughly 83 million of those downloads took place in the two quarters since the pandemic began.
This period has been transformative for the company. And that’s how quickly we’ve seen the adoption of innovation.
Digital Turbine’s business is booming, and shares have rocketed 133% higher since the early days of June. (That was when its potential really caught my eye. I recommended it to subscribers before Wall Street was talking about it!)
Our work and home lives are increasingly intertwined with technology.
This is a trend we covered here long before the pandemic. And since the global COVID-19 outbreak began, we’ve stressed that it would accelerate the adoption of various pieces of technology and innovations.
Apps are a part of this story, as are companies like Digital Turbine that help us manage them.
And targeting the companies that have been preparing for this digital and mobile shift has generated sky-high returns. And this trend is far from over.
Here’s to high returns,
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