Stocks can be classified into two; growth and dividend stocks. As their name implies, dividend stocks offer a high dividend that investors can count on, while growth stocks are those with a high possibility of increasing in price over time. In terms of risks, growth stock takes the leading bar.
The general rule of investment is that the more the reward, the more the risk. There are situations where you can take advantage of the market downturn of some stocks, buy them cheap and wait for the stocks to jump back on their feet. This is a great height of financial intelligence. In today’s video, we want to show you four growth stocks that are cheap with regard to the price-to-earnings ratio. These stocks give you a price advantage and boost your portfolio as they grow over time. Ensure you read this blog to the end so you don’t miss any important points.
Top Stocks That Give You a Price Advantage and Boost Your Portfolio
Most growth stocks revolve around technology. This is why we love lululemon being a stable apparel stock with potential growth. Lululemon sells technical athletic wear that suits customer needs for yoga, running, gym sessions and so on. The stock price went down by more than 20% from the previous year. We can count on the company because they’re known for good quality clothing. More so, they’re now expanding their horizons into different markets. Analysts forecast an average EPS of thirteen dollars by 2025. Lululemon started with yoga, transcended into workout wear and is now into business and corporate clothing. With their deep-rooted brand name, they’ve stood the test of time and still have extra room for growth. Now that the price is down, it’s a good time to buy cheap and wait for the growth to happen.
This is the leading stock on our table today. Established in 1993, Nvidia today has a dominant position in AI and computer graphics innovation and production. The company’s work has transformed industries from healthcare to gaming and so on. According to Investment bank Jefferies, Nvidia has the front position with around 80% market share in the data centre GPU space. This is a massive growth potential for Nvidia as they continue to dominate the market. The company is also planning to expand into the data centre CPU market and launch its CPUs in 2023. Nvidia stock has been down by 45.48% from the previous year and is trading right now at around 120 dollars. Nvidia surely has a major role to play as we head into advanced technological innovation, which will reflect on the stock value. Now that the price is down, we see it as a good buy.
Founded by Jack Dorsey and Jim McKelvey and previously named square, Block Inc is an American company that provides financial services to aid the smooth operation of business operations. With a negative earning score, this stock is apparently underperforming at the time of this video. Block is facing this heated moment not because the basic business is not doing well but their huge investment in crypto.
It’s very risky to invest in Block as it deals with very volatile cryptocurrencies. However, it has great growth potential should the crypto market become green again. If you want to take up the deal and invest, then you must evaluate your risk. Don’t put all your savings in this kind of stock in general, but not more than you are willing to lose.
PayPal is well known for its electronic commerce service that allows parties to send and receive payment. The stock is currently trading at 84.17 dollars which shows a fall of 67% from the previous year. Even though the stock has dropped so much this year, Analysts still remain bullish on the eCommerce company. According to them, competition has retarded PayPal’s growth. However, the company still has a large customer base which reflects in the last quarter’s 12% increase in transactions per account. They also expect 14% revenue growth from the company in 2023.
With regards to the eBay migration from using PayPal, the CEO said, “If you can look beyond the eBay transition, which we have five more months to go through… and you look past the lapping of the very high quarters of growth that we had last year, you can see a very consistent and strong story about the underlying core business”. And he’s right. PayPal is the most downloaded mobile finance app worldwide and the most popular eCommerce service provider in North America and Europe. So if they can keep their customers and enhance their reliability, there is more hope for growth. Therefore, buying this dip might be a rare chance to win the lottery.
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Recommended books for further reading:
- A Beginner’s Guide to the Stock Market: Everything You Need to Start Making Money Today
- The Barefoot Investor: The Only Money Guide You’ll Ever Need
- How to Day Trade for a Living: A Beginner’s Guide to Trading Tools and Tactics, Money Management, Discipline and Trading Psychology
- The Financial Times Guide to Investing:The Definitive Companion to Investment and the Financial Markets: The Definitive Companion to Investment and the Financial Markets
- Intelligent Investor: The Definitive Book on Value Investing – A Book of Practical Counsel
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