Apple Gets a Stern Warning
Less talking, more pictures.
That’s the philosophy we’re adopting today. And with good reason, too.
I’m going to hit you with a trio of key insights about technology investments. The news might surprise you…
Take a look and feel free to email your comments, questions, or biting criticisms afterwards to email@example.com. Enjoy!
The iPod’s Days Are Numbered
When it comes to Endangered Tech Species, we noted last week that digital cameras and portable music players are clearly on the list.
And here’s some fresh proof that the personal music player – the most popular of which is Apple’s (AAPL) iPod – is about to join the dodo bird in extinction.
It’s easy to see why the iPod’s popularity is fading.
Thanks to free streaming music services like Pandora (P), consumers don’t have to pay a penny for MP3 songs anymore.
Not to mention, it’s kind of hard to sell a gadget when its main function already comes baked into every smartphone.
Apple has enjoyed a fantastic run with the iPod… but the tech world is fast and fickle, so the company had better be innovating the next breakthrough consumer technology.
Tech Stocks Are Good for Dividends, Too
On Wednesday, I challenged you to think like a contrarian.
And I demonstrated my point by explaining why you should consider investing in hard disk drive (HDD) manufacturer, Seagate (STX).
Today, I’m going to challenge you to flex your contrarian muscle yet again.
You see, most people think technology stock investments are only good for one thing – capital appreciation.
After all, tech companies are supposed to reinvest all their excess cash into R&D to create world-changing technologies.
But many tech companies – especially larger ones like Apple – rake in more cash than they could ever possibly reinvest in growth. As a result, they’re increasingly returning it to shareholders via dividends.
As you can see above, the yields on S&P 500 tech stocks are rising.
In fact, the last time we witnessed a spike to these levels was back in 2008. However, it was a result of plummeting prices. (Remember, yields rise with falling prices.)
But this time, share prices and yields are increasing. And there’s only one way for that to happen – tech companies keep upping their dividend payments.
If you want a simple, easy way to capture increasing tech dividends, consider the First Trust NASDAQ Technology Dividend Index Fund (TDIV). (You can read more about it from my colleague, Ryan Anders, here.)
Bring on the Cashless Society, Would Ya?
Earlier in the year, we pegged near-field communication (NFC) and mobile payments as two top tech trends to invest in this year.
And the latest data only solidifies our bullishness…
Four months ago, the U.K. transit authority rolled out NFC for paying bus fares. And even in that short period of time, adoption has soared – from zero transactions to over one million.
As Transport for London’s Shashi Verma says, “Enabling customers to use their contactless payment card on the buses removes the inconvenience of… needing to dig around for cash before making a journey.”
No wonder the number of NFC payment users is expected to balloon in the U.K. over the next five years.
The lesson is clear: If you build the mobile payment platform, they will pay!
That’s it for today. Be sure to let us know what you think about today’s column – or any of our work at Tech & Innovation Daily – by emailing us at firstname.lastname@example.org.
Ahead of the tape,