Everything You Need To Know About Services Sector Stocks In The US

The services sector plays an important role in the growth of the US economy. The US is, after all, a service-based economy where providing services generates more revenue than producing goods.  

Recent data indicates that the US services sector is stronger than ever as the IHS Markit US Services PMI has gone from 58.3 in January 2021 to 58.9 in February 2021. 

This is the highest the index has been since March 2015. Investors who may be keeping an eye on these positive trends may want to know more about investing in stocks from the US service sector.  

In this story, we'll take a factual look at the US services sector, popular stocks, past performance, and how Indian investors can buy US stocks using Cube Wealth for as low as $1.  

Important: This blog is meant to educate readers and the information furnished here is not to be construed as investment advice from Cube Wealth. Please consult a wealth coach or financial advisor before investing in any asset.

What Is The Services Sector In The US?

In simple words, the services sector contains companies that provide a service like communication services, financial services, health care services, and more. These companies do not produce tangible goods or extract raw materials.

The US is widely regarded as the world's first service economy. The service sector contributes approximately 80% of the USA’s GDP while employing roughly the same percentage of employees. You can consult a Cube Wealth Coach or download the Cube Wealth App.

The IT industry contributes the lion's share of revenue to the US services sector. This is pretty much the same case in India as well. 

Top 10 Most Popular Services Sector Stocks In The US

1. American Financial Group Inc

• Ticker: AFG
• Market Cap: $10.528 Billion
• EPS: 16.45
• Beta: 0.93
• Present Value: $123.71
  

2. Brookfield Asset Management Inc

• Ticker: BAM
• Market Cap: $78.741 Billion
• EPS: 0.86
• Beta: 1.35
• Present Value: $49.99
  

3. Salesforce.com Inc

• Ticker: CRM
• Market Cap: $226.228 Billion
• EPS: 4.74
• Beta: 1.09
• Present Value: $244.24
  

4. Alphabet Inc

• Ticker: GOOGL
• Market Cap: $1.659 Trillion
• EPS: 75.04
• Beta: 1.02
• Present Value: $2,436.66
  

5. Goldman Sachs Group Inc

• Ticker: GS
• Market Cap: $125.464 Billion
• EPS: 40.26
• Beta: 1.49
• Present Value: $369.34
  

6. Select Medical Holdings Corporation

• Ticker: SEM
• Market Cap: $5.661 Billion
• EPS: 2.37
• Beta: 1.41
• Present Value: $41.97
  

7. Amazon.com, Inc.

• Ticker: AMZN
• Market Cap: $1.702 Trillion
• EPS: 52.56
• Beta: 1.15
• Present Value: $3,374.90
  

8. T-Mobile Us Inc

• Ticker: TMUS
• Market Cap: $182.347 Billion
• EPS: 2.42
• Beta: 0.57
• Present Value: $146.20
  

9. Ameriprise Financial, Inc.

• Ticker: AMP
• Market Cap: $29.256 Billion
• EPS: -0.53
• Beta: 1.70
• Present Value: $252.75
  

10. Netflix Inc

• Ticker: NFLX
• Market Cap: $219.482 Billion
• EPS: 59.91
• Beta: 0.75
• Present Value: $495.20
  

Past Trajectory of Investment Returns In The US Services Sector

The US service sector (especially IT & financial services) has historically performed well due to top companies like Amazon and Google that contribute to the growth of the sector. 

Here’s a look at the % change of various industries involved in the US service sector:

How To Invest In US Services Sector Stocks?

The Cube Wealth app is the most efficient platform to invest in US services sector stocks from India. Here's why:

• Cube simplifies the investment journey with a simple and intuitive app that doesn't have complicated graphs and jargon
• Cube helps you open a US brokerage account with our partner, DriveWealth. 
• Cube lets you invest in US stocks for as little as $1

FAQs 

1. Why is the services sector important in the US stock market?

Ans. The services sector is a key driver of the US economy, accounting for a significant portion of GDP and employment. It encompasses a diverse range of industries and plays a vital role in supporting consumer and business needs.

2. Which are some of the prominent companies in the US services sector?

Ans. Leading companies in the US services sector include tech giants like Apple and Microsoft, healthcare providers such as UnitedHealth Group, financial institutions like JPMorgan Chase, and entertainment companies including Disney.

3. What are the key trends and challenges in the US services sector today?

Ans. Current trends include the rapid expansion of technology and e-commerce, the growth of telehealth services, and the impact of global economic conditions. Challenges encompass regulatory changes, cybersecurity threats, and competition.

4. How can investors make informed decisions when investing in US services sector stocks?

Ans. To make informed investment decisions, investors should stay updated on industry trends, analyze individual company financials, and consider their investment objectives and risk tolerance. Consulting with financial advisors can also provide valuable insights. You can consult a Cube Wealth Coach or download the Cube Wealth App.

Conclusion

The US services sector is a vital and dynamic segment of the stock market, reflecting the diverse range of intangible services that support the nation's economy and lifestyle. This sector encompasses technology, healthcare, finance, entertainment, and various other industries, making it a significant contributor to the country's GDP and employment.

In recent years, the sector has experienced notable trends, such as the rapid growth of technology and e-commerce, the expansion of telehealth services, and the profound impact of global economic conditions. Companies within the sector have adapted to changing consumer preferences and market dynamics, often leading to innovation and new business models.

You can buy US stocks on the Cube Wealth app with buying and selling advice from Registered Investment Advisor (RIA), Rick Holbrook who manages ~$130 million for HNIs. Watch this video to know how US stock advice works on the Cube Wealth app

‍Important Note: All facts & figures mentioned in the tables above have been collated from publicly available sources. The companies mentioned in the tables are listed in no particular order and are a reflection of US' most popular service sector brands at the moment. Cube Wealth does not recommend purchasing stocks based on popularity alone and suggest you consult a Wealth Coach before putting your hard-earned money into any asset.

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