Baby boomers are arguably the most lauded living American generation, while millennials are often characterized as distracted, entitled and self-obsessed. Fair or not, one thing is undeniably true: millennials are entering the most productive and lucrative years of their professional lives, which means they’ll be driving the economy for decades to come.
What companies are set to benefit as this new generation wields its increasing economic influence? These seven stocks should grow and thrive with the millennial generation.
Match Group (ticker: MTCH). Match Group, recently spun off from media mogul Barry Diller’s IAC/Interactive (IAC), is king of the online dating revolution. With top-tier dating brands like Match.com, Tinder, OkCupid, and PlentyOfFish to its name, Match Group controls a large segment of the online dating market. After reporting exceptional first-quarter earnings results, investors swiped right on MTCH stock, sending shares soaring 15 percent higher recently. With millennials increasingly meeting their significant others online, Match Group is a great pure-play bet on the power of love in the 21st century.
[See: 8 Stocks to Buy for a Great 2016.]
Under Armour (UA). Under Armour is another company challenging the status quo, taking on Nike (NKE), the king of sports apparel. In one of the few industries where endorsements from athletes can actually constitute a competitive advantage, Under Armour scored a big win by signing NBA MVP and 3-point sharpshooter Stephen Curry in 2013 (before his first MVP campaign). That prescient effort is paying off big time, with sales of his signature Curry One basketball shoe soaring, creating a new source of revenue for Under Armour.
Facebook (FB). Despite fears in recent years that younger users were abandoning the platform, advertisers can attest that Facebook remains one of the best ways to reach young consumers. Millennials, sometimes teased for being addicted to their smartphones, have helped Facebook shareholders earn huge returns. At the beginning of 2016, mobile ad revenue made up 82 percent of Facebook’s total revenue. As the owner of Instagram and an early proponent of virtual reality, Facebook is definitely in tune with the zeitgeist of millennials.
Tesla Motors (TSLA). It may be a little while before millennials have the scratch to buy themselves a Tesla – but perhaps not too long. The U.S. has posted a remarkable 74 straight months of private sector job growth, and when the Tesla Model 3 drops in late 2017 or sometime in 2018, it should set you back just $35,000 before incentives. Given the reasonable price point and the environmentally conscious nature of most millennials, Tesla’s sleek, sexy (and now more affordable) electric vehicles should only grow in popularity over time.
Amazon.com (AMZN). If millennials really are lazy and entitled, wouldn’t they love drone delivery? The truth is, anybody would love drone delivery the way Amazon envisions it. If you have an urgent need, just order your product on Amazon, select drone delivery, and within 30 minutes, your order is air-dropped to you. Online shopping certainly won’t get less popular in the years ahead, and with Amazon also working on a virtual assistant powered by artificial intelligence (Alexa), today’s young professionals will be using Amazon products and services for years to come.
Chipotle Mexican Grill (CMG). If you subscribe to the “invest while there’s blood in the streets” approach, today may well be the time to invest in Chipotle. Sure, the company is currently reeling from a series of health crises, but there’s no reason to believe these will continue to happen over the long term. Fast-casual isn’t going away, and Chipotle’s vow to stick to organic food is popular with younger, increasingly health-conscious consumers. At less than $13 billion, Chipotle is worth about one-tenth of McDonald’s Corp.’s (MCD) value, illustrating its room to grow.
Alphabet (GOOG, GOOGL). Looking for a futuristic company with its mind on the consumers of tomorrow? Look no further than Alphabet, one of the boldest and most forward-looking companies around. Not only has Alphabet’s Google been the best search engine on earth for more than a decade, its research surrounding self-driving cars could change the world. Like Facebook, Alphabet is also researching virtual reality, which it sees as a huge new opportunity. The self-driving car opportunity is especially massive, and Google’s technology is almost guaranteed to play a very large role.