If your ultimate investing goal is becoming a millionaire, there's one sector you'll want to overweight within your portfolio: Technology.
The tech sector's stocks have a long history of outperforming the overall market. That's because tech companies tend to introduce the world's most revolutionary products and services. Think mobile phones, or high-speed internet, or augmented reality.
With that as the backdrop, here's a closer look at three fantastic technology stocks with lots of upside ahead. Each one of these names is not only a leader in its respective arena, but also offers products or services everyone is going to need.
1. Qualcomm
When most investors think of chip companies, Nvidia and Intel likely are the first ones to come to mind. And understandably so. Nvidia's tech is at the heart of most chip-related products and services. Meanwhile, Intel's processors are still found in most of the world's conventional computers.
These aren't the only chipmakers we would struggle to suddenly live without, however. Qualcomm (QCOM 0.39%) is in the mix, too, and perhaps even more important to you than Intel or Nvidia.
See, Qualcomm makes or owns the rights to a technology that powers just about every mobile phone on the market. One of its core products is its powerful Snapdragon processor, giving your handheld device computing power that nearly rivals that of your laptop or desktop, but at a fraction of the size. It's not just your smartphone's CPU (central processing unit), though. Qualcomm's wares are found inside 5G and Wi-Fi antennas, within audio equipment, onboard smart cars, and even within security cameras, just to name a few. None of it is super-high-profile stuff. What Qualcomm lacks in "wow" factor, however, it more than makes up for in the breadth and depth of its product portfolio. The world's not simply going to stop using its technologies now. It can't.
NASDAQ: QCOM
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The company is also positioning itself for what could be a massive opportunity. That's the next chapter of the ongoing advent of artificial intelligence (AI).
To date, most AI work has been handled by data centers far away from your computer, phone, or even an enterprise-level customer's premises. That's changing, though. This heavy-duty data management effort is increasingly able to be done by the devices at users' fingertips. Qualcomm is leading that charge. As CEO Cristiano Amon explained at the recent annual shareholders' meeting, "We are bringing Gen [generative] AI capabilities to smartphone users worldwide. Our leadership in premium and high-tier Android devices continues with our latest Snapdragon mobile platforms, which now feature significantly enhanced AI processing performance."
It remains to be seen exactly what this will mean; plenty of people are still searching for practical uses of this tech. Qualcomm is prepared for whatever future may be in store, however.
2. Palantir Technologies
While some companies -- and many people -- may still not see much need for AI solutions, don't be too quick to jump to this same conclusion. In many cases, enterprises simply need to be shown how AI can make a positive impact on their business's bottom line.
Enter Palantir Technologies (PLTR +1.32%).
In simplest terms, Palantir turns artificial intelligence into a valuable, practical tool. For instance, the company's platform helps biopharma companies design and better manage clinical drug trials, allows energy companies to optimize their operational assets, and even helps retailers forecast specific inventory needs.
NASDAQ: PLTR
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Perhaps Palantir Technologies' bread and butter, however, is its ability to serve government agencies, and the military in particular. Its Gotham software enables front-line soldiers to be more effective by giving them better information about their opponents, for example. Just this week the company announced it's been awarded a $178 million contract by the U.S. Army's Contracting Command to provide a total of 10 TITAN (Tactical Intelligence Targeting Access Node) ground station systems. TITAN systems provide actionable targeting information for long-range precision fires.
This is just a taste of what's in the cards. The analyst community is calling for top-line growth of nearly 22% this year as more prospects better understand what Palantir can do, and become paying customers as a result. Next year's revenue is projected to grow another 19%. And even beyond that point, there's reason to remain optimistic. Precedence Research suggests the AI software market alone is on pace to grow at an average annualized pace of 23% through 2032.
3. Microsoft
Finally, add software giant Microsoft (MSFT +1.01%) to your list of potential millionaire-maker stocks.
OK, there's no denying Microsoft's massive size makes it difficult for the company to log massive growth rates now. Much of next year's projected revenue growth of 14% reflects a reacceleration from this year's expected relatively slow sales growth of only 6%. Anything above 10% is actually pretty good here.
Where Microsoft really shines is with its bottom line. This business scales up very nicely -- even if a bit inconsistently -- widening profit margin rates as it does.
MSFT Revenue (TTM) data by YCharts
Credit the nature of its business. Once the code for software is written, its core cost is incurred. Sales of that software then end up mostly being turned into gross profit. The business model itself works to its advantage as well. Much of Microsoft's software is now rented rather than outright purchased, generating reliable recurring revenue.
More than anything, though, Microsoft is just good at doing several things, each of which makes its digital ecosystem easier to wade into. GlobalStats says its Windows operating system is installed on more than two-thirds of the world's computers, for example, while its Office productivity apps work seamlessly with Windows. Its Bing search engine is now more than a mere search engine, too. It's become a full-blown AI assistant, incorporating tech from ChatGPT into a platform called Copilot, bringing revenue-bearing traffic to the site. Its cloud computing arm is now growing faster than Amazon Web Services largely because its interface offers all the tools a corporate customer might want, yet it's also simple to use.
Is it the fastest-growing tech stock you can buy? No. But it's one of the most consistent technology companies, and there's never going to be a time when the world won't need what Microsoft brings to the table.
