4 Buy-Rated Growth Stocks To Snatch Up In May

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Growth stocks, especially those from the technology sector, dominated the market in 2020. However, this year investors have been rotating away from expensive growth stocks and betting on the potential of cyclical stocks to capitalize on an accelerating economic recovery. However, this doesn’t denote the complete absence of growth investing opportunities in the market now. In truth, some growth stocks have the potential to continue thriving with the economy’s recovery, and investors have already started rewarding them.

Investors’ renewed interest in growth stocks is evident in the SPDR Portfolio S&P 500 Growth ETF’s (SPYG) and Vanguard Growth Index Fund ETF Shares’ (VUG) 9.4% and 9% returns, respectively, over the past six months.

Abbott Laboratories (ABT), Thermo Fisher Scientific Inc. (TMO), Starbucks Corporation (SBUX), and FedEx Corporation (FDX) are four companies that we think have immense growth potential. So, it could be wise to bet on them now.

Abbott Laboratories (ABT)

ABT is known for creating breakthrough products in diagnostics, medical devices, nutrition, and branded generic pharmaceuticals. The company operates through four segments: Established Pharmaceutical Products, Diagnostic Products, Nutritional Products, and Medical Devices.

The company’s net revenues came in at $10.50 billion for fiscal first quarter, ended March 31, which represents a 35.3% year-over-year rise. ABT’s net income increased 217.9% from the prior-year quarter to $1.80 billion. Also, its EPS increased 222.6% year-over-year to $1.00.

Its revenue has grown at a CAGR of 9.5% over the past three years. Also, the company’s EPS and EBITDA has grown at CAGRs of 148% and 19.3%, respectively, over the same period. This reflects ABT’s steady growth over the past few years.

For the current quarter, ending June 30, analysts expect ABT’s EPS and revenue to increase 115.8% and 53.5%, respectively, year-over-year to $1.23 and $10.45 billion. Moreover, it surpassed consensus EPS estimates in each of the trailing four quarters.

On April 20, WalGreens Boots Alliance, Inc. (WBA) signed a deal with ABT to sell its BinaxNOW Rapid Antigen Self-Test over-the-counter nationwide at WBA’s stores. The move is expected to increase the market reach of ABT’s kits and could lead to increased sales for the company. The stock has gained 27.4% over the past year and has been recently trading at around $118.31.

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Vivian Lewis 1 month ago Contributor's comment

in this week's Barron's Mirova Global Sustainable Equity which I think belongs to French brokerage Natixis, has 3.6% of its assets in TMO. I in fact have more than that, but I am not French. Barron's says it was founded in 2006 which is nonsense as I bought it 30 years ago, but that is because the old TMO merged with a firm making machines for diagnostic testing, healthcare equipment, lab tests, and gene sequencing, which were not part of the original Thermo I bought 30-odd years ago even though I spent some time living in France during that period. They also like another golden oldie I own, Microsoft plus two firms I don't own from Denmark and Germany despite being an ADR maven, only on of which has an ADR. Even though I am a contributor I want to enter your contest.

Vivian Lewis 1 month ago Contributor's comment

although I am mainly an investor in ADRs, my largest holding of all is Thermo Fisher, a US company which I have owned for over 30 years. I bought it with a broker named David Karrick with Dean Witter, both of which are now departed from the scene back in the dark ages when people got analysis from their stock brokers. There is something to be said for that even if I was charged a commission for the purchase.