Finance
3 tech stocks to buy and hold for the next decade
If you look at the stock market over the past decade, many of the best-performing stocks have been technology companies. Recent developments have made technology stocks very attractive and increased their valuations – so much so that seven of the ten most valuable companies in the world are in the technology sector.
No matter how impressive many are tech stocks’ When profits are made, it is important to remember the value of patience in investing. The focus should always be on the long term.
While the past decade has been lucrative for many tech stock investors, the next decade could be just as promising. The following three companies investors should consider buying and holding over the next decade. There will certainly be bumps along the way, but chances are you’ll look back and be glad you invested in it now.
1. Snowflake
Snowflake (NYSE: SNOW) operates a cloud-based data platform that allows users to aggregate, analyze and share data across platforms. Investors had a lot of high expectations for the company around the time of the IPO (IPO), but since then it has been a story of highs and lows.
In the first quarter of 2025 (ending April 30), Snowflake generated $829 million in revenue, which beat the consensus estimate. However, the company fell short of earnings expectations and the stock continued the decline that started in March.
Yes, Snowflake’s year-over-year revenue growth has slowed, but its remaining performance obligation — the revenue it can expect under existing contracts — is up 46% from last year to $5 billion, and management noted that after a period in which some Because they are reluctant to do so, more and more customers are beginning to make longer-term commitments.
Snowflake noted on its latest earnings call that it expects margins to decline in the coming year as it spends significantly on new graphics processing units (GPU) to support its AI initiatives, but that appears to be a necessary infrastructure investment to achieve what the company wants to achieve. it mentions ‘generating meaningful revenue’ in the coming years.
Like many other technology companies, Snowflake is betting big on AI and hopes to drive growth and strengthen its offerings through the emerging technology. Add that to the expected growth of the big data industry, and Snowflake’s long-term value proposition becomes intriguing, especially considering its valuation is now near its lowest since its IPO.
2. CrowdStrike
There are many benefits as the world becomes more digitally connected, but one notable drawback is that it increases the opportunities for hackers to carry out cyber attacks. The global annual cost of cyber attacks was approximately $700 billion in 2017. According to a forecast by Statista researchers, those annual costs will reach more than $13.8 trillion by 2028. That’s true CrowdStrike (NASDAQ: CRWD)one of the largest cybersecurity companies in the world comes into focus.
CrowdStrike was one of the pioneers of AI-native cybersecurity solutions and has quickly become a go-to provider for many of the world’s top companies, including 62 members of the Fortune 100. While AI has attracted mainstream attention in recent years, CrowdStrike uses it for its security solutions from the start, giving it a data advantage over other cybersecurity companies that came to the AI party later.
The effectiveness of CrowdStrike’s platforms can be seen in customer growth and retention. About 65% of its customers use five or more of its modules (software designed for a specific function), 44% use six or more, 28% use seven or more, and the number of deals with eight or more modules grew 95% year over year after year last quarter. This has also boosted CrowdStrike’s financial results.
Cybersecurity is now a non-negotiable cost for many companies worldwide, and this number should only increase. With a price-to-sales ratio of around 23.5, CrowdStrike trades at a premium to its peers, but for investors with time on their side, the growth rate and growth opportunities make that a justifiable premium to pay.
3.Microsoft
Has been around for decades, Microsoft (NASDAQ: MSFT) stands out from the other two companies on this list, but even as the world’s most valuable publicly traded company, it still has a lot of room for growth.
A key reason to hold Microsoft stock for the next decade is the way the company is intertwined with the global business world.
Think of all the products and services Microsoft offers that many businesses rely on in their daily operations: Office products (Excel, Word, Outlook, Teams, etc.), Azure, Windows, and dozens of other business solutions.
Its position as a core provider of services to the global business community protects Microsoft from the effects of economic downturns compared to many of its technology counterparts and gives the company long-term stability. When economic conditions are less than ideal, it’s much easier to postpone device upgrades or cut back on advertising than it is to cancel your cloud service, stop using essential productivity tools, or go without IT infrastructure support to do.
Microsoft’s importance to global business means it will be a dominant player in technology for some time.
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Stefon Walters holds positions at Microsoft. The Motley Fool holds and recommends positions in CrowdStrike, Microsoft, and Snowflake. The Motley Fool has one disclosure policy.
3 tech stocks to buy and hold for the next decade was originally published by The Motley Fool
