3 Top-Ranked Stocks to Buy for High-Growth
Growth-focused investors have been rewarded handsomely in 2023, enjoying outsized gains on the back of improved sentiment. Tech stocks have been standout performers, with plenty of other pockets also seeing positive action.
And to little surprise, there remain many high-growth stocks with favorable outlooks, including Comfort Systems USA FIX, Shift4 Payments FOUR, and Mercado Libre MELI.
All three sport a favorable Zacks Rank and are expected to enjoy solid growth in their current and next fiscal years. For those with a growth-focused mindset, let’s take a closer look at each.
Comfort Systems USA
Comfort Systems USA provides comprehensive heating, ventilation, and air conditioning services. Analysts have raised their expectations across the board, helping land the stock into the highly-coveted Zacks Rank #1 (Strong Buy).
The company has a big growth profile, with Zacks Consensus Estimates calling for 44% EPS growth on 21% higher revenues in its current year. And peeking ahead to FY24, expectations allude to a further 15% improvement in earnings paired with a 15% revenue bump.
FIX shares could also interest those who prefer dividends, currently yielding 0.5% annually. While the yield may be on the lower end, the company’s 15% five-year annualized dividend growth rate helps reflect its commitment to shareholders.
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The company has been a consistent earnings performer, exceeding the Zacks Consensus EPS Estimate by an average of 20% across its last four releases. Shares have regularly gotten a boost following recent releases, as shown below.
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Shift4 Payments
Shift4 Payments is a provider of integrated payment processing and technology solutions. The company sports a Zacks Rank #1 (Strong Buy), with earnings expectations jumping across the board.
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FOUR shares don’t appear valuation stretched given the company’s strong forecasted growth, with the current 20.5X forward earnings multiple well beneath 2022 highs of 69.5X. Shift4 Payments is forecasted to enjoy 92% earnings growth in its current year and an additional 25% in FY24.
As shown below, the company has enjoyed rapid top line growth.
Image Source: Zacks Investment Research
Mercado Libre
Mercado Libre, a current Zacks Rank #1 (Strong Buy), is one of the largest e-commerce platforms in Latin America. Earnings expectations for the company have shot higher, with the trend particularly notable for its current and next fiscal years.
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The company sports the most impressive growth trajectory of the bunch, with estimates calling for 110% EPS growth on nearly 33% higher sales in its current year. And in FY24, expectations indicate a further 52% expansion in the bottom line paired with 25% top line growth.
MELI shares trade at a high multiple, with the current 60.8X forward earnings multiple undoubtedly expensive. Still, investors haven’t minded forking up the premium given the company’s favorable growth outlook, with Mercado Libre shares up 40% in 2023.
Like FOUR, the company has enjoyed strong sales growth, with FY22 revenue of $10.5 billion up 165% since FY20.
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Bottom Line
High-growth stocks have jumped back into favor in 2023 amid a favorable shift in sentiment, with many delivering outsized gains.
And all three high-growth stocks above – Comfort Systems USA FIX, Shift4 Payments FOUR, and Mercado Libre MELI – have seen their outlooks shift positively in a big way, all sporting a Zacks Rank #1 (Strong Buy).
For those with a growth-focused mindset, all three deserve serious consideration.
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Comfort Systems USA, Inc. (FIX) : Free Stock Analysis Report
MercadoLibre, Inc. (MELI) : Free Stock Analysis Report
Shift4 Payments, Inc. (FOUR) : Free Stock Analysis Report
