Year in Review in 7 Charts: Digital Transformation Enters Hyperdrive

Lou Basenese

Thursday, December 24, 2020

Let’s pick up where we left off earlier in the week…

Looking at a graphic or two to put 2020 in perspective — and to position ourselves to profit in 2021!

Earlier in the week, I dished on the major rotation underway into small and micro-cap stocks.

I couldn’t be more thrilled about this trend, as it’s been a major profit driver for me and my readers this year, as well as for my entire career.

And I’m equally excited about today’s featured trend:

The digital transformation of, well, everything!

Covid-19 Induced Opportunity

There are so many negatives from the coronavirus crisis. Like soaring unemployment rates, essential supply shortages, rising mental health issues, and sadly, countless untimely deaths.

But in every crisis lies opportunity. And nowhere is this more evident right now than the digitization of everyday life.

We were already on a crash course for “everything” to be done online. But the pandemic hit the accelerator on this digital transformation.

So much so, in fact, that top research firm McKinsey & Company estimates the average business has accomplished three to four years’ worth of digital transformation in only seven months’ time.

And here’s the key:

These changes aren’t temporary. Nor is the acceleration in adoption. Both are permanent.

And here’s the proof…

Survey Says!

Companies and executives have recently gone from talking about making digital changes to acting on them. Consider the latest survey from tech research juggernaut, Gartner.

As I’ve written about before in reference to the biotech sector, the pandemic has caused a permanent paradigm shift.

And the same is true with respect to digital transformation.

Case in point: A Dell survey of over 4,300 executives in 18 countries reveals a massive migration — from being digital laggards and followers, to being “evaluators” and “adopters.”

This represents a permanent shift in strategy and philosophy, not some one-off response to the pandemic.

More Digital Data

Lest you think I cherry-picked a chart or two to make my own point, here’s some more hard-data proof:

  • According to a recent survey from Accenture, 92% of C-suite execs are accelerating investments in digital transformation. And 74% are completely rethinking their processes and operating models to be more digital — and therefore, more resilient.
  • The latest Global Interconnection Index (GTI) study estimates that digital service providers — such as telecommunications, cloud and IT services, and content, digital media, and technology providers — will increase bandwidth five-fold by 2023. The driver? You guessed it: in the words of GTI, it’s all because of “greater demands from enterprises to close digital gaps.”

All That and a Bag of Chips (Stocks)

But how do we capture all this digital upside in a simple, single investment?

And don’t worry: I’m not about to recommend some untested Covid-19 Digital Transformation ETF…

Just buy chip stocks!

You see, semiconductors are the oxygen for digital transformation.

Without more chips, all the most vital digital trends and initiatives — from cybersecurity to cloud infrastructure to data management to artificial intelligence to remote work and collaboration — just wouldn’t be possible.

So, keep loading up your portfolio with compelling chip stocks in 2021!

I’ve shared specific chip investments with you before, including Lam Research Corporation (LRCX).

But if you want to be the first to know about my next major chip-stock investment, be sure to check out this opportunity.

Ahead of the tape,
Lou Basenese
Lou Basenese

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