3 Tech Stocks to Buy and Hold for the Long Term

3 Tech Stocks to Buy and Hold for the Long Term

Posted On November 9, 2020 2:40 pm

Technology helps shape nearly every industry under the sun, and the influential role that it plays in business will only increase. Tech’s far-reaching impact helps explain why the sector has played the biggest role in powering the market’s overall growth across the last two decades.

Successful long-term investments in highly influential tech companies might just change your life as well. Read on to find out why buying shares of Amazon (NASDAQ:AMZN)Taiwan Semiconductor Manufacturing (NYSE:TSM), and Impinj (NASDAQ:PI) looks like a smart move.

1. Amazon

Taking into account all that Amazon has accomplished since its initial public offering in 1997 (as well as its current market cap of roughly $1.5 trillion), it might be easy to forget that the e-commerce and cloud computing giant is still relatively young in terms of its development. The company stands as one of history’s most innovative and successful businesses, and its growth story is only just getting started.

Crucially, Amazon hasn’t shied away from the possibility of failure. The company’s push into the mobile space with the Amazon Fire phone in 2013 was a major flop, but that didn’t stop founder and CEO Jeff Bezos and his management team from making more big bets in the hardware space.

If Bezos and Amazon had been easily deterred, the company might never have launched its Echo smart speaker hardware and related Alexa voice-assistant software. Because of its willingness to take risks, the company now enjoys a leadership position in voice-based operating systems that’s bolstering its e-commerce business and aiding growth initiatives in revolutionary tech trends such as artificial intelligence.

This same willingness to branch out and innovate enabled the company to make an early move into cloud computing after building a dominant position in online retail. Amazon’s online retail and cloud computing businesses still have huge runways for long-term expansion, and it’s likely that the company’s wealth of resources, fantastic leadership team, and penchant for innovation will allow it to build strong positions in new growth industries. Few businesses look better-positioned to thrive over the long term.

2. Taiwan Semiconductor Manufacturing Company

Between semiconductor companies that only design chips and those that manufacture some of their own designs but lack the capacity to meet their full production needs, there’s a huge demand for third-party chip fabrication. When most leading chip companies need semiconductor foundry services, they turn to Taiwan Semiconductor Manufacturing Company (TSMC).

Technology analyst Steve Milunovich estimates that TSMC fabricates roughly 80% of the semiconductors that are used in the U.S. A report from JPMorgan found that the company produces roughly 50% of the world’s chips and captures roughly 80% of fabrication profits.

Taiwan Semiconductor’s leadership position in high-performance chip fabrication has only become more…

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