However the White House evolves, we will likely have a divided Congress. The House of Representatives will remain under the control of the Democrats, while the Senate will have a small Republican majority. Such a division on Capitol Hill often means that comprehensive policy proposals are unlikely to pass.
There is good news for investors here. A number of game-changing actions will be fine, regardless of the election results. Innovative companies benefiting from clearly competitive or early advantages could enrich their shareholders over time. Here are three main examples.
While I’m bending the rules a bit by choosing a Singapore-based company with a focus on South East Asia, the fact remains that Limited sea (NYSE: SE) is completely oblivious to what is happening in Washington.
Sea’s current main revenue driver is its digital entertainment segment, which has hit mobile gaming Free fire. During the quarter ended in June, Free fire reaches over 100 million daily peak active users, with the game helping push quarterly paid users into the game arena up 91% from the previous year period. There is no doubt that the 2019 coronavirus disease pandemic (COVID-19) has influenced these numbers, with people trapped in their homes having fun. Yet Sea’s digital entertainment offerings were doing well before the pandemic even hit.
However, investors are not charging on Sea because of its gaming segment. They are doing so to own a stake in the innovative online shopping platform Shopee. Southeast Asia has a burgeoning middle class, and Sea is only scratching the surface of consumer demand in the region. In the second quarter, adjusted revenue jumped nearly 188% from the prior year period, as the volume of gross cargo passing through its network more than doubled to $ 8 billion. Shopee appears to be an absolute ecommerce freak in a few years.
Sea has also tinkered with digital financial services. It has over 15 million people signed up to its mobile wallet services and should have no trouble building on that base in a vastly underbanked region of the world.
In short, Sea Limited is going to crush it for the shareholders.
The cybersecurity stock is another innovative business that can thrive no matter what happens with the election. Participations CrowdStrike (NASDAQ: CRWD).
When the COVID-19 pandemic struck, it completely changed the traditional work environment, physical retail, and consumer behavior as we knew it. Companies had little choice but to bring their products and data online and in the cloud. This trend continued long before the pandemic hit, but it accelerated in 2020. This is great news for security providers like CrowdStrike, who provide what is now a basic service for businesses. clients.
CrowdStrike’s Falcon platform stands out because it is cloud native, which means it was built in the cloud for cloud-based security applications. Falcon oversees more than 3 trillion individual events each week, leveraging artificial intelligence to improve identification of potential threats to corporate data. This cloud-native approach is actually cheaper and more efficient for businesses than on-premises security.
CrowdStrike has also become increasingly adept at getting customers to spend more. Just over three years ago, only 9% of CrowdStrike customers had four or more cloud module subscriptions. By the quarter ended in June, that figure had catapulted to 57%. The company has more than doubled its gross subscription margin to 75% in just three years.
This company wrote dollar signs everywhere, regardless of the election results.
One last game-changing company with the tools to make investors rich: the healthcare sector Santé Teladoc (NYSE: TDOC).
Teladoc has been one of the main beneficiaries of the pandemic. As physicians want to keep at-risk and potentially infected patients out of their practices, insurers and physicians are encouraging virtual visits. In the recently completed third quarter, Teladoc saw its total telemedicine visits jump 206% to 2.84 million from the previous year period. For the full year, the company envisions a midpoint of 10.5 million virtual tours.
Telemedicine is a win-win-win for the healthcare space: it’s a victory for patient convenience, a victory for doctors who can presumably see more patients, and a victory for insurance companies who generally receive lower bills for virtual tours.
Teladoc also recently completed the acquisition of cash and shares of applied health signals company Livongo Health. Using artificial intelligence, Livongo collects data and nudges members with chronic illnesses to encourage lasting behavior changes that improve health outcomes. Prior to its acquisition, Livongo had a history of doubling or nearly doubling its number of diabetic limbs on an annual basis.
As a merged company, Teladoc-Livongo will deliver next-generation care with virtual visits and seamless access to patient data for physicians. This company is the future of healthcare in America and could make a lot of money for patient investors.