Since its launch in 2013, Robinhood has seen explosive growth as a trading platform for retail investors, and younger traders in particular. In fact, a study of Gen Z and millennial investors conducted by The Motley Fool in April found that nearly 40% used the platform, making Robinhood the most-used investing app among the 18-to-40 age segment.
While the furor surrounding some of the top stocks trading on the platform isn't much more than hype, a number of the most popular Robinhood buys are worth a second look from the long-term investor. Here are three such stocks that shrewd investors should scoop up right now.
Image source: Getty Images.
1. Nvidia
Semiconductor maker Nvidia (NVDA -10.32%) has continued to record explosive growth throughout the ups and downs of the pandemic. The company is known for its graphics processing units (GPUs), which are used in self-driving cars, video games, data centers, and other applications.
In the first quarter of Nvidia's fiscal 2022 (ended May 2), the company reported that total revenue surged 84% from the year-ago period. Nvidia's gaming and data center businesses accounted for the lion's share of this incredible top-line growth, with these two segments registering revenue increases of 106% and 79%, respectively, year over year. And it wasn't just Nvidia's top line that was looking good in the first quarter -- its bottom-line growth was even higher, at 109% year over year.
Its rapid growth isn't preventing it from increasing its cash position or paying down its existing liabilities. As of the first quarter, the company reported total assets of about $31 billion, with approximately $13 billion in cash, cash equivalents, and marketable securities. Nvidia also reported total current liabilities (obligations due within the coming 12 months) of a far lower $4 billion.
According to a report by Jon Peddie Research, as of the first quarter of 2021, Nvidia held a whopping 81% share of the entire discrete GPU market. The broader semiconductor market (in which NVIDIA remains a key player) is on track to achieve a global valuation of more than $803 billion by 2028, according to Fortune Business Insights.
Nvidia executed a 4-for-1 stock split on July 20, bringing shares down from $750 to a price just shy of $200 at the time of this writing. Even so, the stock is trading about 85% higher than it was 12 months ago. Now looks like a great time to grab shares of this high-flying tech stock before it soars even higher.
2. Apple
FAANG stock Apple (AAPL -1.19%) is the kind of investment that you can keep adding to your portfolio as the years go by, to generate consistent growth when the market is up as well as when it's down. Apple has continued to generate record balance-sheet growth despite the uncertainty of the pandemic economy, and shares of the company have risen 20% since the beginning of this year alone.
In the first half of Apple's fiscal 2021 (ended March 27), total net sales increased 34% compared to the year-ago period. Net income during the six months surged by a healthy 56% from a year ago.
iPhone sales continue to make up the lion's share of Apple's total net sales. In the first half of fiscal 2021, the iPhone segment generated net sales of $113.5 billion. Apple's five core business segments -- iPhone; Mac; iPad; Wearables, Home, and Accessories; and Services -- generated year-over-year sales growth of 34%, 42%, 57%, 28%, and 25%, respectively, in the first six months of fiscal 2021. The company's total net sales for the six-month period were $201 billion.
The smartphone market alone is expected to hit a global valuation of nearly $1.4 trillion by the year 2026, and Apple remains one of the top manufacturers of smartphones in the world. Its substantial brand and ever-expanding market share driven by its vast range of lucrative products, coupled with consistent balance-sheet growth and share-price gains, make Apple a no-brainer stock you can buy and hold forever.
3. Pfizer
Another compelling stock for long-term investors to consider buying right now is one of the largest pharmaceutical companies in the world, Pfizer (PFE 2.27%). Shares are up by about 14% year to date. Investors can also enjoy dividend income from Pfizer. The stock has a hefty yield of about 3.7% at the time of this writing.
Investors have increasingly flocked to buy shares of Pfizer over the past year on the heels of its COVID-19 vaccine success. The company's vaccine, which it developed with its German counterpart BioNTech, amassed $3.5 billion in revenue during the first quarter of 2021 and is expected to generate $26 billion for the full year.
But investors shouldn't buy shares of Pfizer just because its COVID vaccine (now called Comirnaty) has been such a massive commercial success. The company, which has been in business since 1849, has a roster of products that continue to generate impressive revenue increases quarter after quarter. These products are spread across an array of therapeutic areas, including oncology, immunology, and rare diseases.
For example, Pfizer's blockbuster drug Ibrance (for breast cancer) amassed worldwide revenue of about $1.3 billion in the first quarter of 2021. Top-selling drugs Inlyta (for advanced renal cell carcinoma) and Sutent (for a range of rare cancers) earned revenue of $229 million and $200 million, respectively, in the quarter. And Pfizer's blockbuster blood thinner Eliquis brought in a whopping $1.6 billion in revenue in the first-quarter period.
First-quarter revenue and net income both increased 45% year over year, and the company expects remarkable revenue growth for the full year, projecting an increase of as much as 73% from 2020.
According to a report by the news website Pharmaceutical Technology, Comirnaty is on track to remain the top-seller in the global COVID vaccine market over the next several years and is expected to bring in $55 billion in revenue by 2027. Pfizer has already inked a host of lucrative supply contracts for Comirnaty with delivery dates stretching out to the middle of this decade.
And the company's vast stable of other top-selling products can drive continued balance-sheet gains, which will inevitably lead to steady share-price growth, making the dividend of this unstoppable healthcare stock icing on the cake.
