By Matt McCallDec 26, 2018
It’s at this time of year that I like to look ahead to the coming 12 months.
How will they play out? What major catalysts will occur? Where will the market be one year from today?
Some of those questions are harder to answer than others. But we can make educated guesses, and those are what I’d like to share with you today.
I have come up with 10 predictions as we close the book on 2018 and look ahead to the New Year. They range from highly likely – such as the Fed raising interest rates – to a snowball’s chance in you-know where – like the United States legalizing marijuana on federal basis.
Nevertheless, each always has an education theory behind it. And oftentimes it is the most far-fetched ideas that end up coming to fruition.
Let’s dive in…
Prediction #1: Teladoc (TDOC) will be purchased by Amazon (AMZN). The leader in telehealth, one of my favorite mega-trends for the coming years, offers patients the ability to see a doctor from the comfort of their own homes. All they need is an internet-connected device. That convenience combined with money and time saved is a win-win for all parties involved.
Amazon is making a push into healthcare, and what better way to be at the forefront of future? If it does not by TDOC, I suspect a large health insurer will swoop in with an offer.
Prediction #2: Amazon will buy a big box retailer. Speaking of Amazon, the tech giant made a shocking move in 2018 when it brought Whole Foods Market to get into the grocery business and establish a brick-and-mortar presence. The move has been successful, and I expect AMZN’s next move in retail dominance will result in another purchase. By securing more real estate, the company can open more hubs and locations where customers can interact with the whole Amazon experience. A few possible options include Target (TGT), Costco Wholesale (COST), and the remaining Sears Holdings (SHLD).
Prediction #3: Apple (AAPL) will finally spend its cash. Apple is sitting on approximately $237 billion in cash. That’s nearly as much as the entire market cap of retail giant Walmart (WMT). I look for the company to start spending that money as it prepares for its next big hit.
Behind the scenes, AAPL has been preparing to become a leader in healthcare and wearables. The future of healthcare will be focused on tracking daily health vitals, and the Apple Watch will be the core of that. But to get there, the company will need to make some acquisitions – possible worth tens of billions of dollars.
Prediction #4: Uber and Lyft will go public… and end up disappointing. The two leading rideshare companies will make their 2019 market debuts to fanfare. Individual investors will chase these stocks and buy at highs, but look for falls to new lows not long after. I see a Facebook (FB) kind of IPO for both of these companies – they’ll disappoint in the first year before starting uptrends in 2020.
Prediction #5: The S&P 500 will climb a minimum of 25%. At some point in 2019, I look for the market index to be up at least 25% from the 2018 close. The combination of fading trade issues with China, solid corporate earnings, a slowdown in negative political rhetoric, and low valuations will drive investors back to stocks. But keep in mind the key phrase here. I am NOT saying the S&P will close 25% in the green. Just that at some point it will show those kinds of gains.
Prediction #6: Fake will be good news. Meat alternative company Beyond Meat has filed to go public. Also be on the lookout for synthetic diamonds to take over the diamond industry. Both are exactly what millennials are looking for as they upend two traditional industries. And I have to say… I am a fan of them!
Prediction #7: A large country will be high with a major cyberattack. I am not going to say which country, but I expect this to make a big impact. All related stocks – especially cybersecurity ones – will benefit for months.
Prediction #8: Cryptocurrencies will bounce back. 2018 was a very difficult year for crypto stocks and coins. There appears to be a negative stigma here, but I look for 2019 to be stronger with the rally led by the largest coins.
Prediction #9: Microsoft (MSFT) will join the $1 trillion club. The software giant still has some ways to go – it’s currently valued under $800 billion – but I expect it to join the likes of AMZN and AAPL relatively soon. Once it does, look for it remain the largest company in the world for most of the year.
Prediction #10: Oat milk will become the new almond milk, which was the new soy milk over the last few years. I always like to throw one fun prediction into my list! Give oat milk a try in your latte and I know you’ll be hooked. This is a craze we can even capitalize on, and I’m keeping an eye out for potential investments.
Well there you have it… my top 10 predictions for 2019!
With so many innovative trends already at work and new ones popping up every day, 2019 is shaping up to be an exciting year.
For now, I wish you and your family a safe and happy holiday season. Here’s to a prosperous New Year!
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