4 Unbeatable Growth Stocks You’ll Regret Buying in the New Nasdaq Bull Market

Short-term unpredictability has been a buzzword on Wall Street since the start of this decade. During the first four years of the decade, all three major stock indexes oscillated between consecutive bear and bull markets. No index has sustained greater swings than those driven by innovation. Nasdaq Composite (^IXIC 1.10%).

During the 2022 bear market, the Nasdaq lost a third of its value. But since the green flag waved in 2023, the Nasdaq Composite Index has surged 61% and hit all-time highs several times. There’s no doubt that this growth-focused index is in a bull market, albeit in a fairly nascent stage.

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Some investors may be concerned about putting their money into Wall Street with the Nasdaq Composite hitting record highs, but history shows that all stock market corrections and bear markets in the major indexes are eventually resolved by bull markets. Market rally. This means that there can be an opportunity to invest money on Wall Street at any time. If the You are a long-term investor.

Plus it’s worth it ~can do It can also be found among growth stocks. Investors just have to be willing to look for these hidden treasures.

Here are four peerless growth stocks you’ll regret not buying during the new Nasdaq bull market.

Amazon

Even with the Nasdaq hitting record highs, the first standout growth stock investors can confidently add to their portfolios is the e-commerce leader. Amazon (AMZN -0.17%). Even as a selection of forecast and monetary indicators point to an increased risk of a U.S. recession, Amazon’s most important operating segments are perfectly positioned for growth.

Amazon is best known for its online marketplace, which accounted for about 37.6% of U.S. online retail sales in 2023, but the company generates the majority of its operating cash flow and revenue from segments that aren’t necessarily consumer-facing.

Nothing is more important to Amazon’s future than the continued growth of Amazon Web Services (AWS), the world’s leading cloud infrastructure services platform, with a share of about 31% as of the end of 2023, according to technology analytics firm Canalys.

AWS recently surpassed $100 billion in annual running revenue, but enterprise cloud spending is still in the early stages of projected growth. AWS regularly accounts for 50% to 100% of Amazon’s operating profits and is a segment that drives cash flow growth.

Advertising services and subscription services are also essential for Amazon. Advertising hasn’t grown less than 20% year-over-year in the last two years. Meanwhile, the company has strong subscription pricing capabilities through Prime. Instead of offering simple benefits like free two-day shipping on most items, online marketplaces encourage their more than 200 million subscribers around the world to stay in their ecosystem of products and services.

Amazon also maintains historically low prices. You can buy the stock right now for about 12 times consensus 2025 cash flows. This is a significant discount compared to the 23 to 37 multiples of year-end cash flow that investors were willing to pay to purchase the stock throughout the 2010s.

Documentary Sign

The second unparalleled growth stock you’ll regret not buying along with the Nasdaq during the young bull market is the electronic signature company. Documentary Sign (DOCU -0.68%).

There has been speculation in recent months that DocuSign could be acquired and taken private. But CEO Allan Thygesen told CNBC last week that his company plans to remain listed. Short-term traders who were looking to buy may not be very pleased with these comments, but long-term investors should be.

One reason to be excited about DocuSign going public is its e-signature moat. According to Datanyze, DocuSign has more than 67% of the e-signature market. Although the worst of the pandemic and rising interest rates (e.g., fewer loans and mortgages being acquired) have slowed the growth of e-signatures slightly, a double-digit long-term growth trajectory is likely for global e-signatures. Software market.

Another reason to trust DocuSign is the company’s balance sheet. During the January-end quarter (DocuSign’s fiscal year ended Jan. 31), DocuSign fully repaid its outstanding convertible notes. The Company’s approximately $1.2 billion in cash, cash equivalents, restricted cash and investments to begin fiscal 2025 provides the Company with the flexibility to innovate internally and grow inorganically.

For example, just three weeks ago, the company announced an all-cash acquisition of Lexion, an artificial intelligence-powered contract management software company, for $165 million. Integrating contract management into its existing suite of services has the potential to increase DocuSign’s growth rate and expand its sales channels.

And a forward price-to-earnings (P/E) ratio of 16 is a discount for a growth stock with a well-defined moat.

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Green Thumb Industry

The third peerless growth stock not purchased in the new Nasdaq bull market is a cannabis multi-state operator (MSO). Green Thumb Industry (GTBIF -0.62%).

The big buzz about marijuana stocks is that the long-awaited cannabis rescheduling appears to be (finally) imminent. Last week, the Drug Enforcement Administration announced a formal proposal to move cannabis from a Schedule I controlled substance to the less stringent Schedule III controlled substance.

Although moving cannabis to Schedule III would not legalize cannabis for recreational purposes, Section 280E of the U.S. tax code would no longer apply to cannabis-contacting businesses, including MSOs. Section 280E allows businesses that handle Schedule I and II controlled substances to deduct the cost of goods sold. Once this move becomes official, MSOs like Green Thumb will pay significantly less in federal taxes, leading to faster revenue growth.

What sets Green Thumb apart from other MSOs is its product mix. During the first quarter, it generated 57% of its sales from derivatives, including vapes, edibles, pre-rolls, concentrates, beverages, and health and beauty products. Derivatives have higher prices and much better margins than traditional dried cannabis flower. This product mix has been key to increasing Green Thumb’s profitability.

Green Thumb Industries also has a presence in several of the highest cannabis sales states, including California, Florida, and Illinois. We operate 93 dispensaries in 14 states, and we have a back pocket full of retail licenses that we can use to further expand our dispensary footprint in key markets.

Visa

The fourth peerless growth stock you’ll regret not buying in the new Nasdaq bull market is a payment processor. Visa (V 0.10%). Visa suffers from the same cyclical headwinds that have some investors skeptical about Amazon, but Visa’s clear competitive advantages make it a solid buy for those with a long investment horizon.

Visa, for example, benefits disproportionately from long-term economic growth. Recessions are a normal and inevitable part of the economic cycle, but they tend to be short-lived. By comparison, most economic expansions last for several years. For Visa, this means a longer period of increased spending for consumers and businesses.

Adding to this point, Visa executives have deliberately avoided being a lender. Because we are entirely focused on facilitating transactions, companies do not have to worry about credit delinquencies and loan losses that may arise when a recession materializes. Not having to set aside capital to cover these potential losses is a huge advantage for the financial sector.

Like other companies on this list, Visa’s growth trajectory extends years, if not decades, into the future. In addition to being number one in the U.S. in terms of credit card network purchase volume, we have opportunities to expand our payments infrastructure into chronically underbanked regions of the world, such as the Middle East, Africa, and Southeast Asia. Cross-border volume surged 16% in the quarter ending March.