According to UBS, the next decade is likely to favor companies that use technology to disrupt their industries. The “next big thing” in the technology industry will come from areas such as health tech, green tech and fintech, as well as enabling technologies, including artificial intelligence and cybersecurity, UBS said. “Taken together, industry leaders in 2030 are likely to emerge from these sectors,” UBS said in a March 14 report. Therefore, under this theme, we have selected 29 companies that are expected to deliver 'superior' earnings growth relative to the market, driven by 'positive and sustainable structural trends'. The company said the listing is a “long-term focus” and has “strong structural growth drivers” that will allow its pickups to win the broader market. Below are some names from UBS's list and a description of each stock. All are listed in the US. Some of the listed stocks: McKesson: The company provides healthcare services in a wide range of fields, including pharmaceutical distribution, information technology, and care management. UBS is bullish on the company as it expands its focus on a variety of data-driven services across the U.S. healthcare value chain. The bank said its oncology division, for example, gleaned insights from a wide range of prescription and outcomes data that could help pharmaceutical companies in their drug development processes. Baidu: The Chinese internet giant is a major player in cloud computing, which will be a growth catalyst, thanks to its expertise in AI and machine learning, according to UBS. He added that non-advertising businesses such as autonomous driving and cloud are potential long-term growth drivers. “In our view, Baidu's profitability should improve in the coming quarters, and it trades at an attractive valuation compared to its historical price-to-earnings range,” the bank said. Stryker: The medical technology company's share of the core orthopedics market is increasing, supported by its leading position in robotic surgery, UBS said, adding that it continues to grow above market rates. “As the impact of the pandemic fades, the med-surgical and neurology businesses also returned to strong growth,” the bank said. “Elective surgery numbers are strong as healthcare utilization recovers to pre-pandemic levels.” The company's 2024 outlook also predicts high-single-digit sales growth, with UBS continuing to see healthy sales volumes. We expect this to drive margin improvement and profit growth. ASML: UBS said it believes lithography capex spending should continue to rise in the coming years, allowing Dutch semiconductor company ASML to outperform its peers. ASML has a monopoly on his EUV lithography machine, which is the advanced processor needed to manufacture his chips. Furthermore, UBS pointed out that ASML is difficult to break. “ASML's role as a system integrator is often underestimated, but strong supply chain partners can provide additional protection as many of the major suppliers are either proprietary businesses themselves or have exclusive agreements with ASML. Therefore, attempting to break ASML requires extraordinary execution against a lot of hardware “tasks to be done,'' the bank said. Broadcom : UBS says Broadcom boasts a “market-leading” position in semiconductor design. “Its fabless manufacturing model allows Broadcom to generate strong free cash flow, maintain lean capital expenditure requirements and focus on its core strengths of semiconductor research and development,” the bank said. Broadcom says it is well-positioned to tap into structural demand for 5G-related services, data center storage and industrial applications. Meanwhile, UBS noted that the contribution from software and services recurring revenue was “steadily increasing” and “adding diversification and stability to the revenue base.” In the fintech space, UBS also named stocks such as exchange operator Intercontinental Exchange and Mastercard. Green tech companies include French industrial gases and services company Air Liquide, French utility company Engie, and German chemical company Wacker Chemie. Other technology names on the list include software company ServiceNow and semiconductor giant TSMC. —CNBC's Michael Bloom contributed to this report.
