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As we work to instill good values in our children, we generally try to discourage boasting. But as long-term investors with the world's most powerful tool for wealth creation -- the stock market -- at our fingertips, we'll readily admit we want to buy and hold stocks that our kids will at least be tempted to brag about someday.
To that end, three top Motley Fool investors think that iRobot (NASDAQ: IRBT), Tesla (NASDAQ: TSLA), and NVIDIA (NASDAQ: NVDA) fit the bill. Here's why.
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Buy before the robots take over
Steve Symington (iRobot): Shares of iRobot are still reeling from a more than 34% single-day drop in early February, as the market reacted to seemingly disappointing forward earnings guidance from the Roomba maker.
During the subsequent conference call, however, CEO Colin Angle elaborated that the company is purposefully opting to foresake some near-term profits in order to invest in driving top-line growth and maintaining market share in these crucial early stages of its long-term story.
"This is a movement in time where over the next three years the true winners in the consumer robot industry are going to be determined for the next decade," Angle added. He also noted that household penetration in the robotic vacuum market -- which comprises the vast majority of iRobot's current sales -- is still "extremely low," in the single-digit percent range, while strong economic conditions are driving healthy global growth for the category.
Even more important, iRobot knows that the consumer robotics industry will grow to represent much more than "just" robotic vacuums. In floorcare, the company is enjoying steady growth for its supplementary Braava jet floor mopping robots. With the help of their fortress-like patent portfolio and sophisticated mapping and navigation technology, management has also spoken at length of their plans to make iRobot's products the central hubs for enabling smart homes to behave more intelligently in the future.
It's also developing a robotic lawnmower, which would propel it into a new multibillion-dollar market in the coming years. And Angle has previously revealed that iRobot is further exploring consumer robotic solutions for laundry folding, bathroom cleaning, and loading and emptying dishwashers.
As it stands, iRobot is still a relatively small company with a market capitalization of under $2 billion. But if even a fraction of its ambitious plans come to fruition when our kids are grown, I think it will prove to be a stock that early investors will be more than happy to brag about.