Smart speakers have been gaining in popularity over the past few years owing to the rising penetration of the Internet as well as smart devices across the globe. Notably, the utility of smart speakers has been rising steadily too, thanks also to the rising adoption of the Internet of Things. Toward that end, smart speakers can not only play the user’s favorite tunes and answer questions but also control other smart devices at home. However, the COVID-19 pandemic did lead to an increased dependence on smart speakers for listening to news, and music and entertainment, especially in the United States.
Notably, a survey conducted in the United States by NPR and Edison Research during early 2020 showed that since the outbreak of the pandemic, 35% of smart speaker owners reported using their devices to listen to news and information, as mentioned in a
TechCrunch article
. Moreover, the article mentioned that 36% of the respondents stated they increased their consumption of music and entertainment. In fact, 2020 turned out to be a record year in terms of smart speaker sales, despite the challenges posed by the pandemic. Notably, a report by Strategy Analytics stated that the global sales of smart speakers crossed 150 million last year, as mentioned in a
Fast Mode article
. Moreover, the article stated that the introduction of new models by major players during the holiday season led to a positive outcome for the smart speaker market in 2020.
Meanwhile, smart speakers are also proving to be beneficial for healthcare. Notably, smart speakers are capable of helping users plan their workout sessions. Moreover, they can help in relieving stress by playing relaxing tunes that help in calming down. Reflective of these rising trends of smart speaker usage, a report by Research and Markets stated that the global smart speaker market is estimated to witness a CAGR of 34% from 2019 to 2024, as quoted in a
Business Wire article
. Notably, the article stated that factors like increasing smart homes, rising disposable income as well as the growing need for personalized experience are set to contribute to the expansion of the smart speaker market.
3 Stocks to Keep a Close Eye On
The popularity of smart speakers seems set to grow in the future thanks to the many conveniences they bring in terms of providing important news and information while catering to users’ entertainment and fitness regimes, among others. Hence, this makes it a good time to keep an eye on companies that can benefit from this trend going forward. Notably, we have selected three such stocks that carry a Zacks Rank #3 (Hold). You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
.
Apple Inc.
AAPL
offers its smart speakers, namely the Apple HomePod and the HomePod Mini, that are powered by its voice assistant Siri. The Zacks Consensus Estimate for its current-year earnings increased 10.6% over the past 60 days. The company’s expected earnings growth rate for the current year is 36.6%.
Amazon.com, Inc.
AMZN
offers its range of smart speakers under the brand name of Echo, that are powered by its voice assistant Alexa. The Zacks Consensus Estimate for its current-year earnings increased 10.5% over the past 60 days. The company’s expected earnings growth rate for the current year is 18.2%.
Alphabet Inc.
’s
GOOGL
Google provides a range of smart speakers under the Google Nest and Google Home brands and these speakers make use of Google’s own voice assistant. The Zacks Consensus Estimate for its current-year earnings increased 10.2% over the past 60 days. The company’s expected earnings growth rate for the current year is 18%.
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