Exploring investment options with a $500 budget? These two stocks might serve as money-saving investments for 2024 and beyond.
The stock market has reached unprecedented heights around forty times this year, hinting at inflated stock prices. As we edge towards the end of 2024, there are still several lucrative deals in the tech and telecommunications sectors.
If you have spare funds that aren't needed for expenses or emergency funds, these are two budget-friendly stocks that you might want to consider investing in. They're both selling at under $500 each. These companies are riding positive trends in their respective industries that could propel their share prices even higher in the coming years.
1. Micron Technology
Micron Technology (-3.74%) is a significant player in the memory and solid-state storage drive market for consumer electronics and data centers. The stock has soared by 50% over the past year, even after a 36% drop from its peak.
The growing investment in the data center market continues to be a significant boost for the company, making it an excellent buy during a dip.
Revenue surged by 93% year-over-year in the company's latest quarter. "We're stepping into fiscal 2025 with the strongest competitive positioning in Micron's history," CEO Sanjay Mehrotra stated in the fiscal Q4 press release. The company is anticipating record revenue over the next year.
Micron can be a volatile stock due to the cyclical nature of its business. Memory products, such as dynamic random access memory (DRAM) modules, can see fluctuations in selling prices that impact Micron's revenue. Despite the competitive market, the long-term trends related to artificial intelligence (AI) infrastructure require more memory and storage to handle increased data processing, which provides a substantial tailwind for Micron's business.
The volatile nature of this market is also why it's a good time to invest in Micron right now. With demand for advanced memory products exceeding supply, profits are on the rise. Looking forward to fiscal 2027, Wall Street analysts predict Micron's earnings per share to reach $10.96. This leaves the current share price trading at less than 10 times those estimates, which is an attractive bargain.
Next year, Micron should witness increased demand from the availability of new AI-optimized PCs, AI smartphones, and AI servers. Investors should expect the stock to reach new highs over the next 12 months.
2. Verizon Communications
Verizon Communications (0.21%) shares have risen by 18% over the past year, as investors consider the increased wireless revenue and growing 5G adoption from smartphone buyers. The stock's high dividend yield will also become more appealing to investors as interest rates fall, potentially triggering a rise in shares in 2025.
Recent earnings reports have allayed Wall Street's concerns over flagging growth in the face of macroeconomic challenges and competition among wireless operators. Verizon's monthly billed wireless phone net additions, or subscribers, doubled year-over-year in Q3, while the company maintained low customer churn, indicating a powerful competitive offering versus other wireless carriers.
Investors are now looking towards the future, where Verizon is expected to deliver profitable growth in 2024 and beyond. It has a pending acquisition of Frontier Communications for $20 billion, which will expand its fiber and broadband services. Full-year revenue is anticipated to increase by less than 1% in 2024 before rising by 2% in 2025, according to Yahoo Finance.
Telecom stocks are particularly appealing to dividend investors due to the consistent revenue from meagerly billed services. Over the years, through mergers, what is now Verizon Communications has paid a growing dividend for 40 years. It currently distributes 59% of its 2024 projected earnings as a forward dividend yield, bringing the yield to 6.48%.
Verizon should benefit from the increasing demand for AI-enabled devices. Additionally, the company's focus on driving profitable growth and reducing debt should enhance the stock's appeal on Wall Street. Lower interest rates also amplify the allure of the stock's high dividend yield. Therefore, Verizon stock should surge higher over the next year.
- Given the ongoing investing trend in technology and telecommunications sectors, analyzing companies like Micron Technology and Verizon Communications could be an excellent finance strategy for diversifying your portfolio. Micron, with its strong position in the memory and storage market, is expected to witness increased demand for advanced memory products due to AI infrastructure and the availability of new AI-optimized devices.
- As the year 2024 comes to an end and we look forward to 2025, investors might find attractive opportunities in buying stocks like Verizon Communications. With its high dividend yield, growing 5G adoption, and pending acquisition of Frontier Communications, Verizon is expected to deliver profitable growth, making it a solid choice for dividend investors.
