These Growth Stocks Could Continue To Power Up When The Market Shows Weaknesses
Investors looking for growth stocks will need to search far and wide for stocks that are outperforming the broader market consistently. Admittedly, the market’s big rally in 2020 may have some investors convinced that all the top tech stocks have been overbought. However, if we are to look at it in detail, it might reveal a different story.
With many investors speculating that a stock market crash is imminent, the recent dip in the market may strengthen their belief. Although the valuation concerns may be valid, investors must also note that some of the skyrocketing stock prices are justifiable. Over here, I’m referring to stocks like Square (NYSE: SQ) that have solid fundamentals and a positive long-term outlook. And not companies with good stories to tell but lack fundamentals.
Admittedly, many stocks that delivered huge gains in the past may slide alongside the broader market this week. There also seems to be a reallocation from tech and healthcare sectors to energy and fintech companies. Yet despite the shifts that are currently at play, there are still growth stocks to be found, many of which have been offering solid returns. Perhaps you are looking for the best growth stocks to power your portfolio at the start of 2021 and beyond. If so, you might want to take a closer look at these growth stocks that flourished not only in the stock market today but could also be attractive investment opportunities for the long haul.
Top Growth Stocks To Watch Right Now
- Wix.com (NASDAQ: WIX)
- Twilio Inc. (NYSE: TWLO)
- Roku Inc. (NASDAQ: ROKU)
- Trade Desk (NASDAQ: TTD)
Cloud-based web development services provider Wix.com has had a spectacular year so far in the stock market. The company is known for its easy to use website builder and offers a variety of customization for its websites. Wix is also one of the tech companies that benefited from the COVID-19 pandemic. The company has enjoyed a year-to-date increase of 36% and traded at $344.12 per share.
From its latest quarterly report, revenue came in 38% higher year over year to $282.5 million. The company added 185,000 net premium subscriptions in the fourth quarter. That brought its total subscriber count to 5.5 million as of the end of 2020. Wix’s total registered user base, meanwhile, climbed 19% to 196.7 million. As Wix continues to pivot its technology to address the e-commerce space, I guess it’s safe to say that the growth runway for WIX stock is far from over.
“We have concluded the most successful year in our company’s history. In 2020, over 31 million new registered users joined Wix, we added nearly 1 million net new subscriptions, and we crossed $1 billion of annual collections for the first time. It was truly humbling to help lift millions of businesses through an extremely challenging year,” said Avishai Abrahami, co-founder and CEO of Wix.
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- Could Twilio (TWLO) Stock Continue To Defy Gravity As Everything Move Towards The Cloud?
Cloud-based communication specialist Twilio is probably one of the few tech stocks that are bucking the trend during this week’s market sell-off. The company may command an expensive-looking valuation, but the company’s financials easily justify its premium price tag.
This week, TWLO stock continues to defy gravity as businesses continue to migrate their operations online. The company’s revenue growth looks to be stellar as long as enterprises continue to move their operations to the cloud.
The company reported its fourth-quarter earnings in the extended trading hours Wednesday. Revenue came in $548.1 million, representing an increase of 65% year over year. What’s more, this was also Twilio’s second quarter in a row of showing accelerating growth. CEO Jeff Lawson believes the company is looking at a generational opportunity. While Twilio stock is trading sharply higher on its fourth-quarter report, there’s likely still plenty of room for TWLO stock to run if you have a long time horizon.
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Streaming video platform Roku is another growth stock that handily beat Wall Street’s estimates this week. Revenue came in 58% higher as the streaming media service continued to benefit from customers watching more entertainment at home. For the first quarter, the company expects total revenue between $478 million and $493 million, while analysts expect it to be $461.89 million.
Also, the company said that it will begin launching Quibi content later this year after purchasing the online media network’s content in January following Quibi’s shuttering last year. For the uninitiated, Quibi is a short-form video content provider. Following this acquisition, the company also signaled that it would consider other reasonably priced acquisitions in the near future.
“Despite a pandemic-related advertising slowdown in the U.S., our advertising business proved resilient with Q4 Roku monetized video advertising impressions more than doubling year over year, as advertisers increasingly followed users from traditional pay TV to streaming,” Chief Executive Anthony Wood and Chief Financial Officer Steve Louden said in a letter to shareholders.
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Trade Desk Inc.
If you are an early investor in Trade Desk, you would have probably scored big with this growth stock. Amid strong growth in the connected TV (CTV) where it sells ads on streaming platforms, revenue came in 48% higher for the quarter. For those unfamiliar, the company helps brands place their ads strategically within various media forms. The company generates revenue by taking a spread on the advertising slots that it purchases on behalf of brands that use TTD’s platform.
There are a few tailwinds that could continue to bring great revenue for the company. First thing is that the CTV advertisement is booming and you can thank COVID-19 for that. According to a recent survey carried out by The Trade Desk, 27% of households plan to cut cable this year. Looking at this, brands would certainly have good reasons to adopt advertising on CTV platforms. Furthermore, the company had also announced a partnership with Walmart (NYSE: WMT) to launch an expanded version of Walmart Connect. Considering that most Americans shop at Walmart, the synergy between these two could bring in significant revenue for both companies.
Despite the stock’s appreciation, there is likely still room for this company’s stock to climb higher over the long term. If you are planning to invest in TTD stock as part of your long-term investment, it is still a well-managed business with a massive market opportunity. Just expect some volatility along the way over the long haul.