The COVID-19 pandemic shifted much of retail activity to online marketplaces, much to the chagrin of traditional brick-and-mortar stores like GameStop. The gaming retailer has had a tough past 18 months even as its stock performance over this period seems to tell a different story. Shares of GameStop have soared more than 1,900% in the past year. 

But this showing is largely due to the gamma squeeze we witnessed earlier this year than with the company's actual financial results. There remains a long road ahead before GameStop can recover from its woes. In the meantime, investors would do well to put their money in safer, better stocks. Two that come to mind are DexCom (DXCM -0.23%) and Netflix (NFLX 0.51%)

NFLX Chart

NFLX data by YCharts.

1. DexCom

There are about 34 million diabetes patients in the U.S., representing 10.5% of the country's total population. Managing this chronic illness requires a lot of discipline. DexCom helps make this task easier with its G6 Continuous Glucose Monitoring (CGM) system.

Many diabetes patients still use traditional blood glucose meters (BGMs) that rely on fingersticks. There are at least two serious drawbacks to BGMs. First, they only read a patient's blood glucose level at a single point in time. Second, fingersticks can be painful.

By contrast, CGMs like DexCom's use tiny sensors that test the glucose almost continually -- a process that is associated with better health outcomes. In a U.S. clinical trial that compared diabetes patients using DexCom's G6 to those using more traditional competitors, G6 patients spent an average of four additional hours per day within their target glucose range.

Doctor checking up on patient in a private residence.

Image source: Getty Images.

Technology that improves the health of its target market -- and also happens to be more convenient than alternatives -- is likely to be highly successful. That's what we're witnessing with CGMs in general and with DexCom's G6 in particular.

DexCom currently generates the bulk of its revenue from the G6 and accompanying accessories. As a result, the company's revenue continues to grow rapidly. In the second quarter ended June 30, DexCom's top line grew by 32% year over year to $595.1 million.

And with the diabetes population predicted to increase in the coming years, that trend should continue. Even if the population of diabetes patients were to stay the same, there remains significant room for growth, said DexCom CEO Kevin Sayer recently:

A majority of people on mealtime insulin continue to manage their diabetes with finger sticks. Even in the U.S., a leader in CGM adoption, we continue to believe that the type one market remains less than 50% penetrated and the type two intensive market is less than 25% penetrated.

With that in mind, I believe DexCom is still relatively early in its growth story. I expect the healthcare company to continue beating the market in the long run, making it an excellent stock to consider adding to your portfolio. 

2. Netflix

It seems like such a long time ago when Netflix was still a DVD rental service. The company's decision to switch to streaming proved a shrewd one. The tech-giant's performance over the past decade speaks for itself. And even though the streaming industry is much more competitive than it used to be, I believe Netflix can continue to thrive.

The company had a little more than 209 million paid members on its platforms as of the end of the second quarter, up 8.4% from the same period last year. Netflix uses the information it gathers from its customers -- from age and gender to content-viewing patterns -- to make personalized recommendations and keep users engaged.

The company also uses this data to create its own TV shows and movies. Here's some evidence that this strategy is bearing fruit: Netflix's creations are highly successful. The company had 36 Oscar nominations this year and took home seven awards, beating out every other studio.

Hand pointing TV remote control at content library.

Image source: Getty Images.

Netflix's growing content library is a powerful reason why it will retain the bulk of its customers even if it loses some to competitors. The company can also continue to grow its user base. There remains significant opportunity in many developing nations where internet penetration is much lower. But even in the U.S., there's still some room to grow for the tech giant.

According to data from global information and measurement company Nielsen, linear cable still controls 63% of the total television viewing time in the U.S. Netflix is looking to replace linear TV. To quote the company's co-CEO, Reed Hastings: "There's plenty of room to grow without taking it away from the other streamers."

The slowdown in subscriber growth Netflix experienced recently should not be a worry. After all, the company's user base grew more quickly than anticipated in 2020 as a result of the pandemic.

In the long run, Netflix looks well-positioned to dominate an ever-increasing share of television viewing time while adding new subscribers to its already large base. That's what makes the company an excellent investment option to consider today.