If you have invested in Amazon 10 years ago and held in your shares, the value of your position would have increased by approximately 1,660%. An investment in Netflix the share would have produced a return of 1720% over the same period. There are other great companies that have delivered even better returns recently. E-commerce service provider ShopifyFor example, the company’s stock has jumped more than 4,480% in the past five years.
You won’t always buy a stock for the best price, but supporting large companies that have lasting advantages in growing markets will help you achieve big wins. With that in mind, read on for a look at two companies that have what it takes to crush the market for the long haul.
1. Match group
Match group (NASDAQ: MTCH) is a leader in the dating apps market. While its flagship app, Tinder, accounts for the majority of its revenue, the company’s umbrella company also includes dating services Hinge, Match, Plenty of Fish, and OkCupid. No competitor has a greater reach in the US and European markets, and it looks like the growth of the company is just beginning.
The coronavirus pandemic has made it more difficult to add paying users for the business, but Match has still managed to show impressive growth. Fourth-quarter revenue increased 19% year-over-year to $ 651 million, and the average monthly subscriber count increased 12% to 10.9 million.
In a year marked by serious challenges related to the pandemic, Match still managed to increase its turnover by 17% to reach $ 2.4 billion. Sales growth is a little lower than the 19% annual increase the company posted in 2019, but Tinder is still the highest-grossing non-video game app in the world, and it’s clear there is still a lot of momentum behind the activities of the company. .
Match has a leading edge in the dating arena with its diverse collection of apps. Tinder accounted for around 58% of the company’s revenue last year, but the company’s ecosystem approach has value. Technological advancements for a platform can be shared across apps, and the strong growth of the Hinge app, in particular, shows that Match has real opportunities outside of Tinder. The company also has ample room for growth in international markets and recently announced that it will spend $ 1.7 billion to acquire South Korean social media company Hyperconnect.
The dating apps market is still relatively young. Attracting more members on board and increasing the average revenue per user should lead to big profits over time. The growth of the online dating market seems to be a safe bet, and Match has a good chance of maintaining a leading position in the category.
2. Activision Blizzard
After having experienced a difficult period at the end of 2018, Activision Blizzardof (NASDAQ: ATVI) the share price is back in force. The video game maker operates a success-dependent business, and the lack of major new franchise releases, combined with declining performance at some properties, has briefly slowed its growth. However, strong sales for the company Call of Duty series on consoles and PC platforms and the release of a hugely popular mobile version of the franchise helped change his fortunes.
In addition to Call of Duty, Activision Blizzard also produces successful franchises, including World of warcraft, Candy Crush Saga, Diablo, and Overwatch. Following the incredible success of Call of Duty: Mobile, the management seems fully committed to associating more of its intellectual properties with smartphones and tablets. There is great potential there.
Activision Blizzard also offers an extensive catalog of titles ready to be monetized. The publisher has already had considerable success with game remakes in the Tony hawk, Crash Bandicoot, and Spyro the Dragon franchises, and there’s still a lot of untapped content in the company’s library to work with. This approach to monetizing older games has seen huge success since Nintendo in recent years, with video game re-releases that have generated solid unit sales and margins on its Switch hardware, and Activision should be able to do more on that front.
While the natural progression of video game product lifecycles means that business performance tends to be somewhat uneven, Activision Blizzard has generally done a great job of launching and maintaining lasting properties. The game publisher will continue to play a leading role in shaping the future of interactive entertainment, and its stock looks set to deliver long-term payoffs.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are motley! Questioning an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.