3 Growth Stocks Expected To Keep Outperforming In 2021: Tesla, Chewy, And Roku

NASDAQ: TSLA | Tesla, Inc. News, Ratings, and Charts

Growth stocks, primarily in the technology sector, for the most part drove the stock market’s unprecedented rally last year after a correction in March. Changes in consumer and enterprise behavior necessitated by the pandemic drove an exceptional increase in demand for the sector’s products and services, which translated into solid growth in revenue and earnings by these stocks.

The solid performance of growth stocks is evident from the SPDR Portfolio S&P 500 Growth ETF’s (SPYG) 31% gains in 2020. The SPDR S&P 500 ETF Trust (SPY), a broader market indicator, generated 16% returns over the same time frame.

As most pandemic-driven trends are expected to continue this year even if the economy gradually returns to normal with the vaccine rollout as expected, we think companies that witnessed solid growth in 2020 will keep growing this year. We expect their stocks to continue outperforming the rest of the market.

Tesla, Inc. (TSLA), Chewy, Inc. (CHWY), and Roku, Inc. (ROKU) are three companies that have unique offerings, and their products and services are in high demand. After delivering solid returns in 2020, these stocks are likely to do well in 2021 as well.

Tesla, Inc. (TSLA)

TSLA needs no introduction. In addition to electric vehicles, the company is involved in producing stationary energy storage systems and powertrain components. TSLA has operations in the U.S., Norway, China, and internationally. TSLA’s stock gained 696.4% in 2020.

TSLA recently built a production facility in China. The company is also plans to construct new facilities in Brandenburg, Germany, and Austin, Texas. The company recently announced that it will begin operations in India, which could be a major market for the company.

For the last three years, TSLA’s revenue has grown at a CAGR of 37.8%. The company’s EBITDA has grown at a CAGR of 165.6% during the same period. TSLA’s revenue is expected to grow 59.9% year-over-year for the quarter ended March 31, 2021 and 46.4% in 2021. The company’s EPS is expected to grow 69.3% in 2021 and at a rate of 396.7% per annum over the next five years.

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