Another election is now in the books, but things aren’t nearly as clear as we’d like, at least of this writing in the early evening of Nov. 4, 2020.
Whichever way the White House swings, we’ll likely have a split Congress. The House of Representatives will remain under the control of Democrats, while the Senate will have a small Republican majority. Such division on Capitol Hill often means that big-picture policy proposals have little chance of passage.
There’s good news for investors here. A number of game-changing stocks are going to be just fine no matter what the election results are. Innovative companies with clear-cut competitive or early mover advantages could make their shareholders rich over time. Here are three prime examples.
Though I’m fudging the rules a bit by picking a Singapore-based company focused on Southeast Asia, the fact remains that Sea Limited (NYSE:SE) is completely unaffected by what’s going on in Washington.
Sea’s current major revenue driver is its digital entertainment segment, which houses hit mobile game Free Fire. In the June-ended quarter, Free Fire reached more than 100 million daily peak active users, with the game helping to push quarterly paying users in the gaming arena up 91% from the prior-year period. There’s no question that the coronavirus disease 2019 (COVID-19) pandemic influenced these figures, with people stuck in their homes entertaining themselves. Yet Sea’s digital entertainment offerings were doing well even before the pandemic hit.
However, investors aren’t loading up on Sea because of its gaming segment. They’re doing so to hold a stake in innovative online shopping platform Shopee. Southeastern Asia has a burgeoning middle class, and Sea is just scratching the surface of consumer demand in the region. In the second quarter, adjusted revenue jumped by nearly 188% from the prior-year period, with gross merchandise volume crossing its network more than doubling to $8 billion. Shopee looks as if it’ll be an absolute e-commerce monster in just a couple of years.
Sea has also been tinkering with digital financial services. It’s signed up more than 15 million people to its mobile wallet services and shouldn’t have trouble building on this base in a largely underbanked region of the world.
In short, Sea Limited is going to crush it for shareholders.
Another innovative company that can thrive no matter what happens with the election is cybersecurity stock CrowdStrike Holdings (NASDAQ:CRWD).
When the COVID-19 pandemic hit, it completely upended the traditional work environment, brick-and-mortar retail, and consumer behavior as we knew them. Businesses had little choice but to take their products and data online and into the cloud. This trend was going on well before the pandemic struck, but it’s accelerated in 2020. That’s great news for security solutions providers like CrowdStrike, which provide what’s now a basic-need service for enterprise clients.
CrowdStrike’s Falcon platform stands out because it’s cloud-native, meaning it was built within the cloud for cloud-based security applications. Falcon oversees more than 3 trillion individual events each week, leaning on artificial intelligence to improve at identifying potential threats to enterprise data. This cloud-native approach is actually cheaper and more efficient for businesses than on-premise security.
CrowdStrike has also become increasingly adept at getting its clients to spend more. A little over three years ago, only 9% of CrowdStrike’s customers had four or more cloud module subscriptions. As of the June-ended quarter, this figure had catapulted to 57%. The company more than doubled its subscription gross margin to 75% in just three years.
This company has dollar signs written all over it, no matter what the election results are.
Teladoc has been a key beneficiary of the pandemic. With physicians wanting to keep at-risk and potentially infected patients out of their offices, insurers and doctors have been encouraging virtual visits. In the recently ended third quarter, Teladoc saw its total telemedicine visits jump 206% to 2.84 million from the prior-year period. For the full year, the company is looking at a midpoint of 10.5 million virtual visits.
Telemedicine is a win-win-win for the healthcare space: It’s a win for patient convenience, a win for physicians who can presumably see more patients, and a win for insurance companies that usually receive lower bills for virtual visits.
Teladoc also recently completed the cash-and-stock acquisition of applied health signals company Livongo Health. Using artificial intelligence, Livongo collects data and sends nudges to members with chronic illnesses to encourage lasting behavioral changes that improve health outcomes. Before its acquisition, Livongo had a history of doubling or nearly doubling its diabetes member count on an annual basis.
As a combined company, Teladoc-Livongo will offer next-generation care with virtual visits and seamless patient data access for physicians. This company is the future of healthcare in America, and might make patient investors a lot of money.