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By: Aquib Nawab
Finance
The S&P 500 is officially in a bull market, a reality that many investors have been hoping for since the pandemic highs and the doldrums that followed. Here are two names to consider when you go stock shopping in the coming weeks.
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Alphabet, which includes Google, is a mature but solid long-term investment opportunity. Google commands a global market share of approximately 92% in the search engine industry.
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Projections indicate that the global search engine market could generate nearly $500 billion in annual revenue by 2031. Advertising spending, despite some fluctuations in recent years, is showing signs of positive momentum.
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For the full year 2023, Alphabet reported profits of $74 billion on total revenue of $307 billion. Google Ads contributed $66 billion to the $86 billion in total revenue for the final quarter. Additionally, YouTube ads revenue experienced a 16% increase year-over-year, approaching $9 billion. Alphabet ended the year with $111 billion in cash and investments on its balance sheet.
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Over the past five years, Alphabet has witnessed over 70% growth in both annual revenue and profits. Furthermore, the stock has seen a 60% increase in its share price over the last year. This growth is attributed to increased optimism surrounding Alphabet's role in the emerging world of artificial intelligence (AI).
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Like other tech giants, Alphabet is integrating AI tools such as generative AI across its properties, from Google Search to its cloud segment. These developments make Alphabet an appealing investment option with promising future growth potential.
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Costco Wholesale has built a robust business model around its warehouse locations, where members can buy a wide range of goods in bulk at discounted prices. The annual membership fee starts at just $60.
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Costco's membership-based approach allows it to compensate for low-margin products. The availability of wallet-friendly items in larger quantities drives higher sales volume, contributing to steady profit and revenue growth over the years.
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Costco is committed to maintaining its members-only model, even requiring photo ID along with a membership card to prevent non-members from accessing its stores. Membership renewal rates in the U.S. and Canada are at an impressive 93%, and globally, it stands at 91%. In the most recent quarter, membership fees alone generated $1.1 billion, while quarterly profits amounted to $1.6 billion.
Credits: The US Sun
Over the past decade, Costco's straightforward business model has driven annual revenue up by 115% and profits up by 206%. Despite a dividend yield of around 0.6% at the time of this writing, the dividend has increased by approximately 50% in the last three years. For investors seeking steady growth and dividend income, Costco presents an attractive choice for their portfolios.
Credits: Mainebiz