Many cryptocurrencies rallied back over the past year as expectations for lower rates drove investors toward speculative investments again. Moreover, the approvals of the first spot price exchange-traded funds (ETFs) for Bitcoin and Ether, Ripple's victory against the U.S. Securities and Exchange Commission (SEC), and Bitcoin's halving in April all brought more bulls back to this segment of the market.
It might be tempting to jump on the crypto bandwagon again, but investors should realize those tokens still mainly trade on market hype instead of sustainable long-term strengths. Instead of placing big bets on the volatile crypto market, it might be smarter to invest that cash in a few high-risk and high-reward plays in the tech sector instead.
I believe these three tech stocks -- AST SpaceMobile (ASTS +6.44%), Serve Robotics (SERV 2.54%), and Lumen Technologies (LUMN +2.77%) -- have the potential to generate bigger gains than any cryptocurrency over the next few years. Let's find out a bit more about these stocks.
Image source: Getty Images.
1. AST SpaceMobile
AST SpaceMobile develops low-earth orbit (LEO) satellites for cellular communications. Unlike SpaceX's Starlink, which provides medium-range coverage through mid-band spectrums, AST's satellites provide lower-band connections which can be directly accessed by every day 2G, 4G, and 5G smartphones across wider regions.
AST SpaceMobile was founded seven years ago and went public by merging with a special purpose acquisition company (SPAC) in 2021. It launched its first BlueWalker 3 prototype satellite for 4G and 5G connections in September 2022, and it secured cellular broadband agreements with AT&T and Verizon Communications this May.
NASDAQ: ASTS
Key Data Points
AST has a market cap of $5.2 billion, but it hasn't generated any meaningful revenue yet. That's because investors expect its revenue to soar after it successfully launches its first commercial satellites. It's scheduled to launch its first five commercial Block 1 BlueBird (BB) satellites next month -- and the outcome of that event will either make or break its pricey stock.
If AST successfully launches its satellites and expands its network, analysts expect its revenue to rise from just $4.3 million this year to $691.7 million in 2026. If that happens, it could generate massive multibagger gains over the next few years.
2. Serve Robotics
Serve Robotics develops autonomous sidewalk-delivery robots. It started as a unit of Postmates, which was subsequently acquired by Uber Technologies in 2020. Uber spun out Serve Robotics in 2021, and the newly independent company went public through a reverse merger (similar to a SPAC acquisition) with a blank-check company in 2023.
Serve Robotics is still a tiny company that only operates a fleet of about 100 robots, and only 48 of those robots were active on a daily basis in the second quarter of 2024. Uber Eats is Serve's primary customer, and the food-delivery giant plans to deploy up to 2,000 of its robots across the U.S. by 2025.
NASDAQ: SERV
Key Data Points
The bulls believe that massive expansion will boost Serve's revenue and attract the attention of other companies. That's why analysts expect its revenue to grow from just $1.6 million this year to $60 million in 2026. With a market cap of $441 million, Serve already trades at 7 times its projected sales for 2026 -- and that's assuming it can scale up its fledgling business. However, Nvidia -- which owns a 10% stake -- still seems bullish on its long-term growth potential.
3. Lumen Technologies
Lumen, the telecom company formerly known as CenturyLink, saw its stock price plummet below $1 this June. At the time, many investors thought it was destined to go bankrupt as its big bets on expanding its wireline business backfired.
Unlike AT&T and Verizon, which expanded their wireless businesses and downsized their wireline businesses, Lumen avoided the wireless market and doubled down on expanding its residential and business wireline networks. Unfortunately, the growth of its fiber business couldn't offset the secular decline of its legacy wireline businesses.
NYSE: LUMN
Key Data Points
As a result, Lumen's revenue declined 11% in 2022 and fell another 17% in 2023. It racked up steep losses in both years and suspended its dividend in November 2022. But over the past two months, Lumen's stock skyrocketed more than 450%.
The main catalyst was Lumen's new deal with Microsoft Azure, the world's second-largest cloud platform, to upgrade its data centers with new networking and fiber equipment. Lumen also struck a deal with Corning to secure a steady supply of fiber optic cables to support that massive new partnership.
Analysts still expect Lumen's revenue to decline over the next three years, but the bulls believe its deal with Microsoft will stabilize its core businesses. Lumen's stock still trades at less than 2 times this year's sales right now, so it could soar a lot higher if it capitalizes on its new partnership with Microsoft to expand its AI-oriented data center businesses.
