The unpredictable economic blackout of 2020 made investors skeptical about the market conditions. The global economy experienced a considerable shock in terms of demand, supply and finance. Investors resorted to consider cyclical stocks to lean on for a while. However, with the rollout of vaccinations in 2021, the economy started healing and gave new hope to investors and companies alike. As we delve deeper into the volatility of the market conditions, this article provides an insight into four growth stocks that can raise the bar and reap great returns.
Growth stocks are the ones that do not guarantee a dividend but promise a higher capital return for stocks. Investors who do not wish for a short-term profit invest in growth stocks. The intention is financial inclusion as well as to grow the profits faster than any other business. Reinvestment of the return increases the earnings per share, thereby increasing the value of the company's stocks.
How to Invest in Stocks?
"Do not put all eggs in one basket"- Warren Buffet.
As beginners, we often fail in understanding personal wealth management and making the right choice for investing. So when you decide to invest in stocks, you must evaluate two things- the amount and the risk you are willing to take. You can choose to pay commission to a broker who manages your investments or invest in your employer's 401(k). You can easily open an online brokerage account with the help of a Robo advisor and proceed with the instructions on stocks, profile management and other services. It is effective to plan your budget and aim for long-term benefits when you invest. There are many user-friendly online tools like stock chart analysis by experts, simple moving average, relative strength index, etc. S&P 500 Index, i.e. (the Standard and Poor's 500 Index), shows the weighted market capitalization index of the top 500 US public companies.
Hot Stocks to Invest for Growth
As we look at the statistics of the performance of the given stocks, they have grown in a short span. Various reasons could have contributed to it- the market conditions, rise in demand for its products, or innovation and developments. Here is a look at the companies' portfolios and why you should invest in them.
Regeneron Pharmaceuticals Inc.(REGN)
A leading pharmaceutical company based in Tarrytown, New York, showcases a robust rise in the value per share in the first quarter of 2021. REGN invents, develops, produces and promotes medicines for the treatment of severe health conditions. Recently, it has announced the effect of their REGEN COV therapy which reduces the death risk in COVID terminal patients by 20%.
The revenue spurted at about $ 2.52 billion at the end of the first fiscal quarter, and the per-share earnings stood at $ 10.09. Looking at the fundamental changes and favorable position, analysts expect the stock price to rise to about $18 in the next quarter. The current value of the stock is $581. The growth prospect of REGN invites investors as the company's position implies a Strong buy as per the Zacks Rating.
Teradata Corp (TDC)
TDC is a hybrid multi-cloud analytics company that provides data analysis to companies. It offers solutions, software, hardware and other consultancy services. The company's in-house reforms to provide software solutions at large are calling in for a growth prospect.
With a 13% rise in the revenue for the first quarter, analysts predict the company to grow to ensure a good return. In the past three months, the stock value has increased to $50.25. The supportive government policies, rise in growth and value attributes makes it one of the best stocks to invest in for a better capital return. A rank of 3 by Zacks implies it to be an excellent place to invest.
Energy Transfer LP (ET)
ET is a company headquartered in Dallas, Texas, that stores and transports natural gas, crude oil and propane. It operates about 9000 miles of natural gas pipelines and sells to power plants, industries, and local distribution.
On February 17, 2021, the company declared that it has entered into a merger agreement and will acquire Enable Midstream Partners in an all-equity transaction at $7.2 billion. This merger will create commercial opportunities for ET and increase the consumer base with more excellent connectivity.
The quarterly revenue for ET stands at $16.99 billion on March 31, 2021, with about a 46% rise. The company's earnings are at $1.21, which stood at a loss of $0.32 for the same period the previous year. It shows gravitating towards profitability shortly. Analysts on valuation predict the revenue to rise at a 71.1% growth rate to $66.63 billion by the end of 2021. ET's EPS is projected to grow at a rate of 986.1% in the current year. A significant surge indicates the best time to invest in ET's stocks is now.
Alkermes plc (ALKS)
Alkermes is a biopharmaceutical company that develops medicines for severe mental illness, cancer and other CNS (Central Nervous System) diseases. It has its headquarter in Dublin, Ireland. The intense research and development team innovates different medicines that promise to relieve patients from severe illnesses. In June 2021, they received approval from the US FDA (Food and Drug Administration) of their latest medicine LYBALVI. This invention is sure to open doors of trade for the brand that will positively change its stock price.
Earnings have grown at 16.4% per year over the last five years, and analysts predict it to grow 74.3% per year. The yearly return stands at 19.6%, showing prospects of growth soon. It has great potential in the future as it offers value and growth attributes.
Evaluate the Best Stock
There are different attributes to assess the best stock before investing. In this article, I have been specific about stocks with the prospect of high growth in the near future. Hence they won't fetch much in a short span but will go long. As stated in the examples, the risk could be high since we have drawn conclusions based on performance predictions. Investors refer to other factors like value of stocks, momentum, quality, stability, sentiment and industry. The better the stock's visibility in these areas, the better the performance. It is always wise to consider all the above factors to get a perspective of the best stock.
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