The cryptocurrency market has experienced a notable resurgence in the past year, primarily driven by growing investor optimism regarding lower interest rates. Key developments, such as the introduction of the first spot price exchange-traded funds (ETFs) for Bitcoin and Ether, Ripple’s recent legal successes against the U.S. Securities and Exchange Commission, and Bitcoin’s upcoming halving event, have reinvigorated interest and drawn bullish sentiment back into this volatile sector.
Despite the appeal of these trends, it is essential for investors to remain cautious. Many cryptocurrencies continue to be influenced by market speculation rather than solid, long-term fundamentals. A more prudent approach may involve allocating resources towards high-risk, high-reward opportunities within the technology sector, where companies like AST SpaceMobile, Serve Robotics, and Lumen Technologies could potentially offer greater returns than cryptocurrency investments in the years to come. Here is the low-down on three prime opportunities with tech stocks rather than Crypto.
1. AST SpaceMobile
AST SpaceMobile is engaged in the creation of satellites positioned in low-Earth orbit (LEO) aimed at enhancing cellular communication. Distinct from SpaceX’s Starlink, which utilises medium-range coverage through mid-band spectrums, AST’s satellites focus on lower-band connectivity directly accessible by standard 2G, 4G, and 5G smartphones across larger areas.
Founded seven years prior, AST SpaceMobile became a publicly traded entity through a merger with a special purpose acquisition company (SPAC) in 2021. The company launched its initial prototype, BlueWalker 3, designed for 4G and 5G connectivity, in September 2022. Recently, it established cellular broadband partnerships with AT&T and Verizon Communications.
Despite a market capitalisation of $5.2 billion, AST SpaceMobile has yet to report significant revenue, as it awaits the launch of its first commercial satellites. The debut of the first five Block 1 BlueBird (BB) satellites is slated for next month, a pivotal moment that could greatly influence its stock performance.
Analysts project substantial revenue growth for AST, estimating an increase from approximately £4.3 million this year to £691.7 million by 2026, contingent upon successful satellite launches and network expansion.
2. Delivery Robotics
Serve Robotics focuses on creating autonomous delivery robots designed for sidewalks. Originating as part of Postmates, a company that was acquired by Uber Technologies in 2020, Serve became an independent entity in 2021. It made its public debut through a reverse merger in 2023.
Currently, Serve Robotics operates approximately 100 robots, with only 48 in regular daily operation during the second quarter of 2024. Uber Eats remains its main client, with plans to roll out as many as 2,000 robots in the United States by 2025.
Optimists speculate that this significant expansion could substantially elevate Serve’s revenue potential, prompting interest from other industry players. Projections suggest that revenue could surge from $1.6 million this year to an impressive $60 million by 2026. The company’s market capitalisation stands at $441 million, translating to a valuation of seven times the expected revenue for 2026, contingent upon successful scaling of its operations. Notably, Nvidia, holding a 10% stake in Serve, maintains a positive outlook on its future growth trajectory.
3. Lumen Technologies
Lumen Technologies, previously known as CenturyLink, faced significant challenges recently, with its stock value dropping below £1 in June. This decline led to concerns among investors about potential bankruptcy, as the company’s strategy to focus on its wireline business did not yield the anticipated results.
In contrast to competitors like AT&T and Verizon, which shifted focus towards wireless services, Lumen decided to concentrate on enhancing its residential and business wireline networks. Unfortunately, the surge in its fibre division was insufficient to counter the ongoing decline of its traditional wireline operations.
Financial performance reflected these struggles, with revenue decreasing by 11% in 2022, followed by a further 17% drop in 2023. The company also recorded substantial losses in both years and halted its dividend payments in November 2022. In a surprising turn, Lumen’s stock rebounded sharply, gaining over 450% in just two months.
The primary driver of this resurgence was a partnership with Microsoft Azure, the second-largest cloud service provider globally, aimed at modernising its data centres. Additionally, Lumen secured a contract with Corning, ensuring a consistent supply of fibre optic cables to support this extensive collaboration.
While analysts predict continued revenue declines in the coming three years, some optimists believe the Microsoft alliance could stabilise Lumen’s core operations. At present, the company’s stock trades at less than twice this year’s revenue, suggesting potential for significant growth if it successfully leverages its new partnership to enhance its AI-focused data centre offerings.
Is Now the Right Time to Invest $1,000 in AST SpaceMobile?
Considering an investment in AST SpaceMobile may warrant a careful evaluation. Current insights from investment analysts reveal that other stocks may offer more promising returns. Recent recommendations highlight a list of 10 top stocks, which notably do not include AST SpaceMobile.
For instance, those who invested in Nvidia after it was recommended in 2005 would have seen substantial growth from their initial investment. An investment of £1,000 at that time could have escalated to approximately £792,725 today. This serves as a testament to the potential of following expert recommendations.
Additionally, subscription services like Stock Advisor offer resources aimed at enhancing investor success. They provide strategies for portfolio management, regular analyst updates, and two new stock recommendations each month. Historically, this service has achieved returns exceeding those of the S&P 500 by more than four times since 2002.
Investors should weigh potential gains against current offerings and consider whether their £1,000 would be better placed in recognised stocks with a solid track record of performance. Thorough analysis and strategic planning are key in making informed investment decisions.
