Investing Insights: Electric Vehicle Trend and Cybersecurity Demand Exploring Potential Growth from Electric Vehicles and Cybersecurity

By: Alex Freidmen

Embracing solid trends and profiting from them isn’t just a speculative endeavor— it’s a wealth-creating venture. While not every investment will result in winning stocks, a few game-changing selections over the long haul can generate extraordinary returns.

If you’re searching for stocks that can harness this century’s vital technology trends, dive into why backing these two prominent companies could lead to significant financial gains.

Albemarle: A Promising Player in Electric Vehicle Trend

Albemarle (NYSE: ALB), a top lithium miner and a key provider of lithium for electric vehicle (EV) batteries, stands as an attractive choice for long-term growth in the EV sector. Despite its stock’s recent decline, Albemarle holds potential for substantial long-term success.

Due to plummeting lithium prices and competition from Chinese rivals, Albemarle’s performance has suffered. Notably, leading automakers such as Ford and General Motors have slashed their EV output plans in the wake of weaker-than-expected demand growth, leading to a 53% plunge in the company’s share price from its 2022 peak. However, business performance hasn’t been catastrophic.

While the company’s sales in the third quarter grew approximately 10% year over year to reach $2.3 billion— below analysts’ targets and the company’s prior guidance— it still anticipates ending 2023 with annual sales growth between 30% and 35%. Valued at less than 1.9 times this year’s expected sales and less than 7 times projected earnings, Albemarle is currently offering significant growth potential at an attractive price.

The deceleration in EV market growth is mainly tied to macroeconomic challenges, which won’t last indefinitely. If the downturn in lithium prices proves to be cyclical and reverses in the future, Albemarle stock has the potential to deliver impressive returns.

Riding the Wave of Rising Cybersecurity Demand

Cybersecurity is already at the heart of business resilience, and its significance is only set to increase further. Financial and reputational harm from security breaches continues to mount, attracting bad actors with growing motivations to target major businesses and institutions in pursuit of ransom payouts or exploiting stolen data for financial gain.

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The cloud-based software from CrowdStrike (NASDAQ: CRWD) is designed to prevent cybersecurity breaches and protect businesses from facing potentially calamitous setbacks. Driven by artificial intelligence technologies, CrowdStrike’s Falcon platform catalogues and adapts to new threats, ensuring that each customer in the network benefits as the library of identified cyberattacks continues to expand.

CrowdStrike recorded a 35% year-over-year revenue increase in Q3, reaching $786 million. Additionally, non-GAAP (adjusted) net income surged by 107% from the previous year to approximately $199 million, with free cash flow rising by 37% to reach $239 million. Moreover, the company finished the period with $3.17 billion in cash and equivalents against zero debt.

With expanding sales and profits and substantial market opportunities still ahead, CrowdStrike presents a compelling opportunity to capitalize on the growing demand for high-performance cybersecurity services.

Driven by its existing services’ growth, the introduction of new product offerings, potential partnerships, and unexplored AI and cloud security prospects, CrowdStrike anticipates its Total Addressable Market (TAM) to balloon to $225 billion by 2028.

With its rapidly growing sales and profits and significant market potential ahead, CrowdStrike emerges as a top choice for tapping into the escalating demand for high-quality cybersecurity services.

Before investing in Albemarle, there are some considerations to ponder. The Motley Fool Stock Advisor team has identified what they believe are the 10 best stocks for investors to purchase, and Albemarle wasn’t one of them. The selected stocks are anticipated to yield significant returns in the coming years.

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