The Stock That Lets You Dance With Robots
The machines are taking over.
We were impressed when a supercomputer became Jeopardy champion, but now the machine revolution is hitting close to home: a self-driving truck just delivered a shipment of beer 120 miles through Colorado; the just-in-case human driver never lifted a finger (and we are assuming he didn’t crack a cold one).
Yes, there are other headlines now, as in the assault on Mosul and apparently some political contest, but the fact that people aren’t more amazed by this is in itself freakin’ amazing.
Self-driving cars have been road-tested for a few years, but this news demonstrates the feasibility of this technology for long-haul trucking. That’s a game changer, and it’s only the latest evidence that, yes, we’re headed for a world in which robots take the place of more humans for many jobs that we thought were safe from our machine overlords.
Working with Humans
Robot use in factories is nothing new; it’s a major reason for the decline in U.S. manufacturing jobs as productivity increases. While it’s unfortunate for the workers who lose their jobs, it’s inevitable as machines that can perform tasks quickly and precisely, without ever tiring or making mistakes.
More than 250,000 industrial robots are in use globally. They’re especially common in making cars, electronics, metals and chemicals, and they’re increasingly used in the energy, military and medical technology sectors. Robots now perform about 10% of tasks in heavy industry; experts say that will rise to more than 20% by 2025.
Even as robots are used more in industry, their use is going to explode in areas where they need to interact with humans – including driving cars, but also many other areas that once raised safety concerns. Thanks to innovations in sensors and artificial intelligence, it’s no longer necessary to isolate robots from people. New technologies, such as high-strength materials and longer-lasting, more efficient batteries, are also helping drive down costs.
And as human-robot interaction becomes common, more companies will invest in it. According to Boston Consulting Group, total spending on robots is growing at a 10% annualized rate, from $15 billion in 2010 to $67 billion in 2025.
If you’re looking for a relatively safe way to play the fast-growing robotics trend, you can’t do much better than Swiss conglomerate ABB (NYSE: ABB).
One of the major industrial controls suppliers in the world – and a global leader in robotics – ABB makes YuMi, a two-arm assembly robot that can work safely side by side with humans and costs only $40,000. As a major supplier to the power generation, energy and other industrial sectors, ABB is poised for solid growth as China, India and other huge emerging markets invest heavily in infrastructure over the next decade.
ABB and other companies feeding this growing market will have the wind in their sails for years to come. And the stock also works as an income investment; the company’s balance sheet and cash flows are strong, and ABB currently yields a healthy 3.4%.
P.S. If you’re still skeptical about what robots can already do, watch this. Blows my mind every time.