Market Mavericks: 7 Growth Stocks Outshining the Giants
The tech giants frequently capture the headlines and drive the stock market to new highs. The S&P 500 has approximately 30% of its total portfolio allocated toward the Magnificent Seven growth stocks.
It’s no wonder those seven stocks influence the stock market to such a high degree. However, there are many up-and-coming media mavericks that have the potential to outperform the giants. Some of these growth stocks have already outperformed the Magnificent Seven and look poised to continue the trend.
Investors looking for new growth stock ideas may want to consider these seven growth stocks.
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Celsius Holdings (CELH)
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Celsius Holdings (NASDAQ:CELH) sells sports drinks that are flying off the shelves. The company routinely reports quarters that feature revenue and net income more than doubling year-over-year. The company continued this trend in the third quarter of 2023.
Financial results like these have spurred a rally for the ages. The stock has more than doubled over the past year and has a 5-year gain that exceeds 5,000%. That’s a higher 5-year gain than Nvidia (NASDAQ:NVDA) and Supermicro (NASDAQ:SMCI).
The incredible thing about the stock rally is that the corporation is still in its early innings. Celsius gets almost all of its sales from North America. The company is just beginning to expand into Canada and Europe. The company’s presence outside of North America is very limited, but that will soon change. Once Celsius Holdings has a stronger global footprint, investors should expect revenue and earnings growth to remain at high levels.
Chipotle (CMG)
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Chipotle (NYSE:CMG) has been a top-performing stock as more consumers look for healthier alternatives. The company is in expansion mode as it aims to open 285-315 new restaurants in 2024. The midpoint of 300 new restaurants is a notable increase from the 271 restaurants Chipotle opened in 2023.
The company has the financial strength to gain more market share. Chipotle increased its revenue by 15.4% year-over-year while delivering a 26.1% year-over-year boost in net income. The company now has a net profit margin in the double digits.
Chipotle has been rapidly gaining market share in the fast food industry, and its stock price has followed suit. Shares are up by 78% over the past year and have registered a 335% gain over the past five years. Those stock gains outperform most of the Magnificent Seven growth stocks.
Demand for Chipotle’s food has only strengthened. Expanding its horizons and starting up additional restaurants will help the company reward long-term investors.
Sterling Infrastructure (STRL)
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Sterling Infrastructure (NASDAQ:STRL) is a construction company that specializes in e-infrastructure. This segment includes data centers, e-commerce distribution centers and warehouses, and multi-use facilities. As tech companies grow, they will need more properties for data storage.
It’s a boon for Sterling Infrastructure which has resulted in a 135% gain over the past year. Shares are up by an astonishing 512% over the past five years. The company is outperforming most of the big tech, and tailwinds for big tech trickle down to Sterling.
The company isn’t only invested in its e-infrastructure category. Sterling Infrastructure recently won big contracts for a major Nevada highway project and from the Lihue Airport in Hawaii in Kauai, Hawaii.
Sterling Infrastructure reported an 8% year-over-year revenue increase in Q4 2023. Net income was up by 99% year-over-year. The company’s midpoints for 2024 guidance are $2.17 billion for $160 million for net income. Those figures represent 10.2% and 15.4% year-over-year growth rates respectively.
Direct Digital Holdings (DRCT)
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Investors looking for a promising micro-cap stock may want to consider Direct Digital Holdings (NASDAQ:DRCT). Micro cap stocks require more research since fewer media outlets cover them, but the company has exhibited meaningful revenue and earnings growth.
The programmatic advertising company has buy-side and sell-side platforms, with the latter doing most of the work for the company’s financials. Revenue increased by 129% year-over-year in the third quarter of 2023 which prompted the company to raise its full-year guidance.
However, the bigger win came from net income which more than quadrupled year-over-year. Net income reached $3.35 million as a part of the big surge. Guidance suggests revenue growth will remain strong for a while. However, if the company can continue to expand its net profit margins, the stock’s returns can give big tech a run for its money.
Investors have gotten excited about the stock. Shares are up by 291% over the past year which is largely due to a dramatic rally that started in mid-November. This makes it one of those growth stocks to consider.
The advertising company should report Q4 2023 earnings near the end of March. Investors who are on the fence may want to wait for those earnings to come out before making a decision.
The Trade Desk (TTD)
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If you want a more established programmatic advertising company that is dominating its industry, you may want to consider The Trade Desk (NASDAQ:TTD). Although the stock has a lofty 103 forward P/E ratio, the company is doing everything else correctly.
The Trade Desk reported excellent results in the fourth quarter of 2023. A rebound in connected TV advertising and expected growth in 2024 resulted in strong first-quarter guidance.
The company told shareholders that it anticipates generating at least $478 million in Q1 2024. That would represent a 24.8% year-over-year growth rate from Q1 2023. That growth rate is slightly higher than what investors saw for the current quarter.
Q4 2023 revenue increased by 23% year-over-year in the quarter while net income jumped from $71 million to $97 million.
The corporation has also authorized $700 million in stock buybacks that it can use at any time to enhance shareholder value. The Trade Desk repurchased $220 million worth of shares in the fourth quarter. Shares are up by 49% over the past year and have gained 321% over the past five years.
Adobe (ADBE)
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Adobe (NASDAQ:ADBE) generates predictable, recurring revenue through its software products. Many creatives and business owners use resources like Adobe Photoshop and Premiere Pro to produce better images and videos.
The high demand for the company’s products resulted in its first-ever quarter of $5 billion in revenue. This milestone represents a 12% year-over-year revenue growth rate. Revenue growth should remain elevated due to the company’s $17.22 billion in remaining performance obligations. Adobe aims to generate $21.40 billion in revenue at the midpoint of 2024 guidance. That represents a 24.3% year-over-year growth rate. Net income was up by 26% year-over-year.
Adobe’s stock price has been similar to Amazon’s (NASDAQ:AMZN). The stock is up by 112% over the past five years but featured a big decline in 2022. However, shares are up by 74% over the past year. The company’s guidance suggests Adobe stock can extend its rally for long-term investors.
Intuit (INTU)
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Intuit (NASDAQ:INTU) has many business software products under its umbrella. However, the company’s most famous software is TurboTax. People use the product to file their taxes every year, and it results in steady revenue for the company. Quickbooks is another popular tool that Intuit owns.
The company’s Q2 FY24 results indicate more growth is ahead. Revenue increased by 11% year-over-year while net income more than doubled year-over-year. Intuit reiterated guidance for the fiscal year which projects 11%-12% year-over-year revenue growth. Expanding profit margins will make the company’s valuation more appealing for long-term investors. All in all, it’s one of those growth stocks to consider.
Intuit has been a winning stock for patient investors. Shares are up by 61% over the past year and have gained 165% over the past five years. The company’s vast array of business software gives it many opportunities to gain market share for the benefit of long-term investors. The stock offers a low 0.55% dividend yield, but growth rates have been solid. The company hiked its dividend by 15.4% year-over-year in 2023.
On this date of publication, Marc Guberti held long positions in CELH and DRCT. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Marc Guberti is a finance freelance writer at InvestorPlace.com who hosts the Breakthrough Success Podcast. He has contributed to several publications, including the U.S. News & World Report, Benzinga, and Joy Wallet.
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