Following a tumultuous decline of over 25% in 2022, the stock market reared its head and surged back in 2023, approaching a close within striking distance of its all-time high. Integrating historical context, since 1957, bull markets have spanned on average nearly five years, gifting stakeholders with a mean gain of slightly over 169%. From the nascent trading days of the Nasdaq Composite in 1972, every year post-market recovery has consecutively yielded an average annual surge of 19% for the technology-focused index. Although the economy’s trajectory remains a mystery, historical accounts foretell a bright year for prospective investors.
Anchoring intentions for stock acquisition often hang on the presumption of prospective returns. Among the triggers for stock procurement is a bullish market, echoing benefits to a multitude of investment shares. Below, I present my top 10 growth stocks to procure before the bull market charges ahead in 2024.
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Alphabet’s Resurrection
Both a momentous downturn in digital advertising during 2022 and a pause in cloud expenditure growth whiplashed Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG). Yet, the prospect of a thriving economy is rekindling a resurgence. Firmly perched as the global search frontrunner, the most massive online advertiser globally, and a heavyweight in cloud infrastructure, Google remains buoyant in its pursuits. Perhaps the most considerable stimulant will be Alphabet’s ventures in artificial intelligence (AI). Introducing Gemini, a purportedly unmatched generative AI system, and over 100 pre-built AI models via Google Cloud, Alphabet is armed with multiple catalysts poised to catapult its prospects in 2024. With the stock historically inexpensive, trading at just 4 times forward sales, unparalleled potential awaits.
Amazon’s Redemption Arc
Economic tribulations, catalyzed by surging inflation, weighed heavily on Amazon (NASDAQ: AMZN) in 2022. Yet, glimmers of growth are sprouting across its expansive dimensions. Digital retail is in the throes of recovery, while AI is infusing vitality into cloud expenditure, powering its stalwart growth areas. Anchoring its stake in AI, Amazon now endows cloud consumers with foremost generative AI models via Amazon Web Services (AWS). Seamlessly integrating AI into its operational fabric, Amazon is arming itself with twin propulsion, heartened by a resurgent economy and fortified with AI. With the stock trading at only 2 times forward sales, the potential for an astronomical return is irrefutable.
MercadoLibre: The Latin American Dynamo
Standing somewhat obscure compared to its peers, MercadoLibre (NASDAQ: MELI) serves as the paramount purveyor of e-commerce and digital payment services in Latin America. A staggering third-quarter revenue ascent of 69%, coupled with a spectacular surge of 194% in operating income, mirror the accompaniment of record-breaking growth last year. Such an upward trajectory is poised to persist, given Latin America’s breakneck pace of e-commerce adoption — among the fastest globally, atop a population nearly twice the magnitude of the U.S. Coupled with margin extension and sturdy cash flow, investors would be remiss to dismiss this Latin American juggernaut.
Microsoft’s AI Rush
Like its technology brethren, Microsoft (NASDAQ: MSFT) bore the brunt of economic turbulence. However, it retaliated with a stupendous $13 billion investment in ChatGPT architect OpenAI, instigating a frenzy to saturate its array of products and services, alongside AI cloud propositions. Its AI-driven digital aide, Copilot, commands robust demand, headlining Microsoft’s “fastest-growing $10 billion business” in its annals. Such demand is resoundingly palpable, evident in Azure cloud revenue’s outpacing of rivals in the third quarter, with a three-percentage-point acceleration attributed to AI impetus. Consequently, the stock, trading at a modest 32 times forward earnings, emerges as a prudently judicious investment in light of its prospective growth.
Nvidia’s AI Odyssey
Extending unrivaled dominance, Nvidia (NASDAQ: NVDA) processors long captured the zenith in gaming, and data center and AI applications, capitalizing on the cavalcade of generative AI brought forth last year. The resulting scarcity of AI chips is anticipated to persist through 2024. Seizing this tumultuous demand, Nvidia galvanized its production, persistently enriching its research and development, yielding continually refining solutions. It championed triple-digit year-over-year revenue and profit swell across the past two quarters. Projecting continued demand for AI, Nvidia hatches as a tantalizing steal, boasting a price/earnings-to-growth ratio (PEG ratio) beneath 1 that outstrips the broader market.
Palantir Technologies’ AI Acrobat
Accruing decades of proficiency in its repertoire, Palantir Technologies (NYSE: PLTR) was primed when AI attained virality last year. A proven pathfinder, harnessing the proliferation of AI, Palantir shines resplendently, offering investors a lucrative path toward the AI gold rush.
The Rising Stars: Top Stocks to Watch in 2024
Palantir Technologies
Palantir Technologies (NYSE: PLTR) has set its sights on the future with the integration of generative AI models into its repertoire. This strategic move has synergized seamlessly with Palantir’s AI-powered data analytics to create the groundbreaking Artificial Intelligence Platform (AIP). According to management, the interest generated in the AIP is unprecedented, tracing back two decades.
Despite appearing expensive at 11 times forward sales, Palantir has shown its mettle with four consecutive profitable quarters, catching the eye of S&P 500 inclusion. As one of the few pure-play AI stocks in the market, Palantir is poised to capitalize on the ongoing AI gold rush.
Roku
Roku (NASDAQ: ROKU) has weathered a challenging period, securing its position as the world’s most utilized streaming platform with a resounding 51% market share. The resurgence of ad spending, coupled with a whopping 76 million active accounts, has fueled substantial growth in advertising on its platform.
Furthermore, Roku is surfing the secular tailwinds of cord-cutting and the shift from broadcast to streaming, making it the prime destination to engage with highly attentive viewers who consume an average of 3.9 hours per day. Investors can find value in Roku’s stock, trading at roughly 3 times forward sales.
Shopify
Shopify (NYSE: SHOP) is on an upward trajectory after navigating through a period of economic downturn. The resurgence in e-commerce expenditure has positioned Shopify, the leading provider of software tools for online merchants, for a period of prosperity. The company’s release of new generative AI tools, in addition to its minority stake in Global-e Online, has facilitated the expansion of merchants into international markets.
An overhaul of operational strategies, including staff reduction and divestment of its logistics business, has fueled substantial growth and profitability for Shopify, making it an appealing prospect for investors.
Tesla
Tesla (NASDAQ: TSLA) continues to defy skeptics, having secured the title of the world’s best-selling car with the Model Y. Notwithstanding headwinds and price adjustments leading to temporary profit declines, Tesla’s push into the automotive mainstream remains unyielding.
With an anticipated drop in interest rates and inflation cooling down, Tesla is poised for a more favorable operating environment, which could facilitate a return to its long-term production goal of 50% annual growth and an expansion of profit margins. At 5 times forward sales, Tesla’s valuation remains reasonable, considering its astounding stock price gains of over 2,300% in the past decade.
The Trade Desk
The Trade Desk (NASDAQ: TTD) managed to capture market share from industry giants such as Alphabet and Meta Platforms, despite the decline in marketing spending in 2022. The company’s self-service digital advertising platform witnessed growth while its competitors suffered year-over-year revenue declines.
The recent introduction of Koa AI copilot by The Trade Desk is expected to further catalyze its momentum, assisting advertisers in optimizing their ad campaigns. Additionally, with a price/earnings-to-growth (PEG) ratio of less than 1, The Trade Desk presents investors with a significant bargain.
