3 Innovative Companies to Keep an Eye On

If you're a fan of innovation, Amazon, Tesla, and Samsung have all been in the news lately with big developments. But what does their latest thinking mean for investors?

Jun 10, 2014 at 4:35PM

Technology is improving at an unprecedented pace, making right now an exciting time to be a growth investor. Three recent stories in the news could be potential game-changers for their industries and are certainly worthy of our attention.

The new "eye"-phone?
Amazon (NASDAQ:AMZN) will hold an event in Seattle on June 18, where they are set to unveil a new smartphone with 3-D capabilities. The phone is rumored to be able to track users' eye movements as a way to scan through content, and also display holographic images in three dimensions. The smartphone is likely to commercialize later this year.

Along with the Kindle tablet and the Fire TV, this is Amazon's newest push into hardware. Amazon seems to be taking a page out of Apple's (NASDAQ:AAPL) playbook. Apple developed a wide variety of "i-everything" hardware devices to sell users content in the form of music and videos. As the United States' largest e-commerce platform, Amazon.com can sell users just about any retail item that they could possibly want. But it is also a one-stop-shop to download books and magazines, stream movies, and watch television shows. The more hardware devices Amazon can get in consumers' hands, they more content it can distribute. And it's the content -- not the hardware -- where Amazon makes the majority of its operating profit.

One last interesting fact: Apple and Samsung together commanded 68% of the U.S. smartphone market during the three months that ended in January 2014. But with all eyes now on Amazon, I'd expect the incumbents to lose a piece of their share.

Look, no hands
Google (NASDAQ:GOOGL) attracted a lot of attention recently with the announcement that it would be building 100 prototypes of a driverless car -- absent of a gas pedal, brake, or even a steering wheel. The car would travel at up to 25 miles per hour, and could even be summoned by a smartphone. So much for waiting around to hail a taxi.

But in addition to that news, Tesla Motors (NASDAQ:TSLA) has been quietly working on developing a driverless car of its own. Tesla's car would use a combination of cameras and sensors to drive autonomously, but still allows humans to take back control if desired.

Tesla has always been a company to play by its own rules. Rather than building its vehicles off of existing technology, it designs everything from the ground up. The new driverless car would follow suit -- with the technology being developed internally. This makes life very difficult for the existing automobile manufacturers. While Ford and GM might be much larger in existing production capacity, it is much more difficult for them to shift gears and adapt to big changes. If electric, autonomous vehicles truly are the wave of the future, I'd expect to see Tesla CEO Elon Musk in the driver's seat.

A wear-house of data
Lastly, Samsung has developed a prototype for its new Simband -- which is a wearable device concept that can collect biometric data such as heart rate, temperature, or oxygen levels. The interesting part is that Simband is not a product, but rather an open-source platform. Other manufacturers can develop and install sensors of their own into the Simband to collect various biometric data. Similar to what Google is doing with Project Ara, Samsung is building the foundation, attracting developers to offer options, then allowing its end users to decide what features they want in their product.

Open-source projects like this are gaining in popularity. Watch for the companies managing the platform to also offer interpretive software as a means to extend the relationship with end users, and even learn more about their preferences. This is an even better way for Samsung to take the pulse of its customers.

Foolish bottom line
Innovation never goes out of style. Companies that have visionary leadership and invest heavily in their business can offer best-in-class products that the market loves. This can result in demand far outpacing supply -- a phenomenon that we saw for Apple's iPad, Tesla's Roadster, and Samsung's Galaxy smartphone. The returns for investors can be excellent as well, as analysts race to update sales forecasts and increase price targets.

The recent announcements from Amazon, Tesla, and Samsung remind us exactly how these companies became the multibillion-dollar market leaders they are today.

Leaked: Apple's next smart device (warning, it may shock you)
Apple recently recruited a secret-development "dream team" to guarantee its newest smart device was kept hidden from the public for as long as possible. But the secret is out, and some early viewers are claiming its everyday impact could trump the iPod, iPhone, and the iPad. In fact, ABI Research predicts 485 million of this type of device will be sold per year. But one small company makes Apple's gadget possible. And its stock price has nearly unlimited room to run for early in-the-know investors. To be one of them, and see Apple's newest smart gizmo, just click here!

Simon Erickson owns shares of Apple. The Motley Fool recommends Amazon.com, Apple, Google (A shares), and Tesla Motors. The Motley Fool owns shares of Amazon.com, Apple, Google (A shares), and Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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