The stock market has had a rather volatile year. From the stock market crash in March to this past week’s record highs when the Dow surpassed 30,000 points for the first time in its history, many investors must have been looking at the market in wonder. With interest rates expected to remain at dovish levels in the near future, investors are turning to top growth stocks to park their money. If you don’t already know, growth stocks are companies that increase their revenue and earnings faster than the average business in their respective industries.
Perhaps you are looking for growth stocks to power your portfolio in the final months of 2020 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.How To Look For The Best Growth Stocks To Buy?
Some say that buying growth stocks early on its run to greatness is the holy grail of stock picking. Yes, but the question here is, how do we narrow them down? This is not as straightforward as it seems, as growth stocks come in all shapes and sizes. Also, they can be found in any industry in any stock market globally. A great way to start may be looking at some growth exchange-traded funds (ETFs) to invest, assuming you are new to investing. However, if you have been actively trading in the stock market for some time now, you can invest in specific stocks that you think have great potential. That way, you get higher risk, but also the chance of higher returns.
There are certain steps that you can take to look for high growth stocks in the stock market today. With vast information on the internet, many can now go on the journey of investing in top growth stocks. The aim is to buy at a reasonable price, and hang on as revenue and earnings rise over time. If you think of specific companies that could benefit from a major trend, that may be a good start. Perhaps you think cloud computing is a great place for growth. If so, you may consider Snowflake (SNOW Stock Report) or Salesforce.com (CRM Stock Report) the top growth stocks to buy. And as you dive deeper, you may identify their competitive advantages and future addressable markets. That way, you may increase your chance of picking highly potent growth stocks. With all that in mind, here are 3 growth stocks you can ride on potentially powerful long-term trends.
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When looking for the best growth stocks to buy, the electric vehicle (EV) industry stood out this year. Nio Inc. (NIO Stock Report) has been one of the best-performing stocks in the stock market this year. Shares of NIO stock are up an incredible 1351.61% year-to-date as of Friday’s closing and traded at $51.21 per share as of 3:45 p.m. ET on Monday. Nio is a premium EV car maker that focuses on the SUV market.
The red-hot EV maker’s third-quarter earnings were sensational. The company beat third-quarter estimates and reported strong fourth-quarter guidance. NIO reported a loss of 12 cents per share from $667 million in sales. That represented a 146% increase in sales year-over-year. In comparison, Wall Street analysts forecasted a loss of 19 cents per share and $663 million in sales. The company estimates that it will deliver between 16,500 and 17,000 electric vehicles in the fourth quarter. This news comes on the heels of the company recently announcing that it doubled its vehicle deliveries to a new monthly high in October. The guide implied that all of these favorable trends will persist in this current quarter.
To date, investors have focused on NIO’s potential to dominate the enormous Chinese EV market at scale. The company appears to be on track to do that. But the question here is, can the company replicate its home success in expanding its retail footprint in North America and throughout Europe? Some analysts seem to believe that the growth in NIO stocks today could persist when the company expands across continents. But it is anybody’s guess. After all, consumer preferences may differ from country to country. Nevertheless, with the company reporting November deliveries in the coming days, would you be buying NIO stocks now in anticipation of yet another record month?
Another growth stock to ride on the EV boom is Blink Charging (BLNK Stock Report). The company operates a network of nearly 15,000 electric vehicle charging stations as of December 31, according to the company. With the rise in adoption of EVs, it is no surprise that the company has been benefiting. In its third-quarter earnings report, Blink saw product sales rising 74% from the same quarter a year ago. Hence, it should come as no surprise that BLNK stock has been on a monstrous rally this year, rising nearly 1,400% year-to-date.
Despite the strong interest in BLNK stocks, the hype seemed to have faded in the past week. This came after the report from short-seller Citron Research had investors selling. While there is no question about the potential of EV charging stations, Blink’s valuation is not cheap by any measure. At a price-to-sales ratio of close to 180 times, it is no wonder that some believe the stock has gotten ahead of itself.
Earlier this month, the company unveiled a new cable management system for use with both new Blink charging stations and retrofit installations of its IQ 200 charging stations. The company also said the system would help with market demand for flexible EV charging equipment configurations. Unlike most of the other EV stocks, with Blink, you don’t have to bet on brand names or consumer taste. After all, EV users need charging stations whichever make and model they drive. With that in mind, is BLNK stock the best bet on the secular EV trend?Top Growth Stocks To Buy [Or Sell] Now: New Oriental Education & Technology Group
New Oriental Education & Technology Group (EDU Stock Report) is a Chinese private educational services provider. It is also one of the best growth stocks to buy according to Ray Dalio. The hedge fund manager boosted his EDU stock holdings again in Q3. For starters, the company offers language training, preparatory courses, assessment tests, admission training, along with primary and secondary education in China. The company has significantly benefited from the pandemic tailwinds in the education sector. New Oriental Education is currently ramping up its small-size online live broadcasting classes, which are done through its online-merging-offline (OMO) system.
“Thanks to our continuous effort in upgrading our OMO system in recent years, we accomplished a prompt migration from offline classroom teaching to online live broadcasting for all customers with the online class size the same as offline classes and interactive features highly similar to offline classes. This enabled us to minimize the impact posed by the COVID-19 outbreak and achieve such encouraging results this quarter,” New Oriental CEO Chenggang Zhou said in a statement.
The most recent event from the company is its secondary listing on the Hong Kong Stock Exchange. The company plans to use the proceeds from the IPO for investments in technologies to enhance students’ learning experience and for business expansion. The company’s share price has been on an upward trend since the stock market crash in March. The question is, can you expect EDU stock to continue its momentum after the pandemic?