Are you worried about investing in the stock market? By waiting on the sidelines, you could be missing out on some golden opportunities. Buying while stock prices are depressed can result in some incredible gains and years from now it may end up being the best decision you made. A couple of growth stocks that can give you varying degrees of risks and opportunities today are Microsoft (MSFT -1.15%) and Curaleaf Holdings (CURLF 2.89%).
Investing in big tech can be one of the safer options for investors. Microsoft isn’t going anywhere and is likely to be a strong investment to hang on to for decades. From its cloud business Azure to its Office suite of products, it provides essential products and services for the business world.
Although the company technically missed analyst expectations in its fiscal fourth-quarter results (for the period ended June 30), it still reported a net income of $16.7 billion that rose 2% year over year. Also, its revenue totaled $51.9 billion and grew by 12%.
If you had bought the stock during the Great Recession, you could have an easy 10-bagger on your hands right now. At the start of 2009, the tech stock was trading at roughly $20 per share. Today, it’s at around $280, and that’s down 20% from its 52-week high of $349.67. Now, that doesn’t mean Microsoft will deliver 10x returns over the next 13 years, but it’s a good reminder that during the market’s bleakest days, it proved to be an incredible buying opportunity.
With terrific profits and management always looking for ways to expand, this is a safe investment to hang on to. Its pending acquisition of video game maker Activision Blizzard, which it expects to close on within the next year, could expand Microsoft’s reach in the gaming world (Microsoft makes the Xbox gaming console).
Microsoft has proven why it’s a buy-and-forget stock that you can comfortably hold for decades. And with double-digit growth projections for sales and earnings over the next three to five years, it looks to continue the trend. Down 18% year to date (which is slightly worse than the S&P 500 and its 15% decline), it’s an attractive buy on the dip.
2. Curaleaf Holdings
Curaleaf doesn’t have the track record that Microsoft does — it only went public in 2018 through a reverse takeover. Its net income has also been consistently in the red, with the company’s losses totaling $107 million over the trailing 12 months.
The stock definitely poses more risk than Microsoft, but its long-term potential over the next 10-plus years could be much more significant. The cannabis industry is still in its infancy with respect to potential as marijuana isn’t federally legal in the U.S. If that changes, that can simplify the logistics for a large multi-state operator like Curaleaf (it has operations in 22 states) and make it possible to transport cannabis across state lines. As a result, profits could become much more attainable.
Curaleaf anticipates that this year, its revenue could hit $1.5 billion (up from $1.2 billion last year) in what management says has the potential “to be another milestone year.”
New Jersey recently permitted adult-use marijuana. Neighboring New York has also legalized recreational pot use, but sales there may not commence until the end of this year. Either way, there are many potential growth catalysts for Curaleaf out there as just 19 states have legalized recreational use of marijuana, and 37 permit medical products.
Although legalization may be impossible to predict, there are certainly opportunities for the business in the long run if it happens. Curaleaf is a riskier buy than Microsoft, but it can lead to a greater payoff in the end. The pot stock has fallen 38% this year as a lack of movement on legalization has certainly hurt its attractiveness. But for long-term investors, the potential is still there.