3 growth stocks I would buy now
DDon’t think for a second that you should avoid growth stocks. Yes, there has been a significant transfer of money from many previously high-end stocks to cheaper stocks over the past couple of months. However, this has no bearing on the long-term prospects of the best growth stocks.
On the contrary, recent massive sell-offs have made many stocks even more attractive with their lower prices. Here are three growth stocks, in particular, that I would buy right now.
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Etsy (NASDAQ: ETSY) held up better than many stocks with the last market spin. Shares of the e-commerce company are only down 15% from highs reached earlier this year. I think Etsy is ready for a strong rebound.
The company had a record year in 2020 due to the COVID-19 pandemic, with gross merchandise sales growing 2.5 times faster than the U.S. government’s e-commerce benchmark. While face mask sales were a major source of revenue growth, Etsy had a much wider appeal to customers looking for unique, handmade products.
My prediction is that Etsy will continue to generate exceptional growth long after the pandemic is over. Etsy now ranks fourth among ecommerce sites in the United States in terms of monthly visits. It is one of the most recognized brands in the retail industry. An increasing number of customers return to the site frequently to make purchases, with 88% of Etsy buyers stating that the platform offers products that cannot be found elsewhere.
I also like the fact that the company invests heavily in product development. Etsy has improved its search capabilities. It expands the use of video to enable salespeople to tell their stories more effectively.
Etsy is still in its early stages of tackling the huge online retail market. This title is expected to be a huge winner over the next decade.
Hedosophia Holdings V share capital
I am a big fan of fintech stocks in general. So when I saw Chamath Palihapitiya’s Special Purpose Acquisition Company (SPAC), Share capital Hedosophia Holdings V (NYSE: IPOE), planned to release SoFi, my interest was piqued.
SoFi stands out as one of the most innovative fintech leaders. The business app is a one-stop-shop that provides individuals with a wide range of financial services, including loan applications, depositing checks, buying and selling stocks, and digital payments.
The novelties are linked. SoFi recently announced that its app will allow users to invest in public company initial public offerings (IPOs). Buying IPO shares has long been reserved for large institutional investors and the super-rich.
SoFi also has great banking ambitions. In March, the company announced an agreement to acquire Golden Pacific Bancorp. This transaction is a key step for SoFi to obtain a national banking charter, which would reduce its loan financing costs and offer more products and services to customers.
The IPOE is down more than 30% from its January peak. I think the stock will provide excellent long-term returns after the merger with SoFi closes.
Teladoc Health (NYSE: TDOC) climbed nearly 140% last year. The telehealth stock also got off to a good start in 2021, with stocks surging 46% in late February. But Teladoc gave up all of those gains and more. Its shares are now down almost 9% since the start of the year.
One of the main reasons for Teladoc’s downfall is that the company’s dizzying growth rate from 2020 appears to be slowing down significantly. Another is that Amazon.com plans to enter the telehealth market this summer. Problems don’t keep me away from Teladoc either.
The company should still have strong growth prospects over the next decade and beyond. Teladoc is only scratching the surface of its US telehealth market. It also has excellent cross-selling opportunities with the digital health platform for chronic disease management that it acquired with the acquisition of Livongo.
I think the virtual care market will be big enough to support multiple winners. And I have no doubts that Teladoc will be one of those winners. This healthcare growth stock still seems like a great choice for long-term investors.
10 actions we prefer over Teladoc Health
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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of the board of directors of The Motley Fool. Keith Speights owns shares of Amazon, Etsy, Social Capital Hedosophia Holdings Corp. V and Teladoc Health. The Motley Fool owns stock and recommends Amazon, Etsy, Social Capital Hedosophia Holdings Corp. V and Teladoc Health. The Motley Fool recommends the following options: January 2022 long calls at $ 1920.0 on Amazon and January 2022 short calls at $ 1940.0 on Amazon. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.