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We've spent the past week reacting to the market correction.
Last week, I showed you three "Fat Finger Market Tools" you can use to protect your current investment portfolio. They're three strategies you can use to turn anything – bloodbath or rally – into money in the bank.
I want you to keep that list in hand because the market has yet to settle down – we're going to keep seeing a lot of turbulence for at least a couple of more weeks.
Then we went over five Strategic Tech Investor Game Changers – three "rules" we'll be using to find our next round of winning technology, legal cannabis, and cryptocurrency plays.
And I promised you I'd circle back soon – using those Game Changers to dig up some new profit opportunities.
Today I start keeping that promise…
I love getting my hands dirty.
By that, I mean I love doing research – digging into data, reports, legislation… and turning up investment ideas for you.
That's why I've spent part of the past few weeks going over President Trump's tax overhaul.
We've already seen how Trump's tax cuts are fattening the wallets of average Americans in the form of hefty raises and big bonus checks.
But really, as good as that is, it's only a surface reading of the new tax laws.
I've already shown you how the tax overhaul is going to encourage tech companies to bring hundreds of billions in overseas profits back home. And how that's going to be huge for tech giants like Apple Inc. (Nasdaq: AAPL) – and investors who'll be seeing rising stock buybacks and dividends coming their way.
I've dug even deeper than that, though, and discovered new tax rules that are going to encourage companies to spend a lot more money on equipment.
I know… yawn.
But this is big.
You see, the new rules embedded in the tax-reform package provide manufacturers an incentive to buy machinery and boost productivity in a tight labor market where unemployment remains near 4%.
No really, it's a bigger move than it sounds.
In the past, firms could only write off a portion of their equipment costs in a single year. The revised tax code allows companies to immediately deduct the entire cost of equipment purchases from their taxable income.
Already, forecasters have ripped up their previous statements and are now saying that planned capital spending on manufacturing equipment in the United States will rise as much as 12% in 2018. That's a 33% increase from the rate forecast just last November.
And that's going to provide a nice catalyst – a profit "trigger" – to the robotics and automation hardware and software sectors through at least 2020.
No One's Talking About This Tax Cut Beneficiary
We all know that robotics and automation are sweeping industries everywhere.
But even I'm surprised at some of the places where they're turning up.
A recent report by International Data Corp. found that the two fastest-growing industries for robotics are healthcare and process manufacturing. The latter is a branch of manufacturing that involves developing products based on recipes or formulas, like sodas or drugs.
"Ride the Unstoppable Trends" is one of the game-changing moves I told you to make on Friday. And robotics and automation definitely fit under that category.
Just check out these numbers…
IDC found that worldwide spending on robotics and related services will hit $135.4 billion in 2019. That's more than double the $71 billion spent in 2015, and IDC is forecasting a compound annual growth rate of 17%.
Those kinds of capital waves have led to a surge of mergers among AI firms, particularly those with strong links to robotics. Robotics and automation systems, of course, increasingly use sophisticated artificial intelligence (AI) algorithms to work even more freely from human involvement.
According to CB Insights, the AI mergers-and-acquisitions market has soared from $559 million in 2012 to more than $4.8 billion last year, a roughly eightfold increase.
Grand View Research predicts spending on AI-robotics systems will rise at a 57% yearly clip through 2025. By that time we'll be talking about a $58.9 billion market.
And all of this was before President Trump's signature made those new tax rules into law late last year and put a rocket booster under the robotics sector.
Now, you could try to pick and choose among all the small robotics players out there – before they get scooped up by a Silicon Valley giant. In fact, that's exactly what we do at my Nova-X Report service – finding breakout small- and mid-cap stocks before they set the market on fire. To find out how to join us, just click here.
But for investors just getting started, that can be a risk-filled endeavor.
And that's why I'm bringing you this play. It beat the market by more than double over the past year – and I believe it can keep doing that and more as it rides the robotics revolution wave.
About the Author
Michael A. Robinson is one of the top financial analysts working today. His book "Overdrawn: The Bailout of American Savings" was a prescient look at the anatomy of the nation's S&L crisis, long before the word "bailout" became part of our daily lexicon. He's a Pulitzer Prize-nominated writer and reporter, lauded by the Columbia Journalism Review for his aggressive style. His 30-year track record as a leading tech analyst has garnered him rave reviews, too. Today he is the editor of the monthly tech investing newsletter Nova-X Report as well as Radical Technology Profits, where he covers truly radical technologies – ones that have the power to sweep across the globe and change the very fabric of our lives – and profit opportunities they give rise to. He also explores "what's next" in the tech investing world at Strategic Tech Investor.