Log in

7 Stocks Set for Monster Growth in 2020

7 Stocks Set for Monster GrowthPosted on Wednesday, September 12th, 2018 by Chris Markoch

When savvy investors look to find high-performing stocks they don’t try to chase returns for the next hot stock. They are very methodical and look for stocks that they can buy now and hold for years knowing that they’ll be solid performers. Part of this strategy means looking for companies that are not only outperforming their sector, but also outperforming the broader market.

With the markets on an epic run, there are many analysts pointing at stocks that are ready to decline. But there are stocks that are poised for growth, not only for the rest of this year but beyond

We’ve identified 7 stocks that are poised for exceptional growth in 2019. Some of these names will be familiar to you. Some other names may be hidden gems. These stocks will reward investors for their patience with solid returns for years to come.

#1 - Autodesk (NASDAQ:ADSK)

Autodesk logo

Autodesk (NASDAQ: ADSK) - Investors have been rewarding Autodesk despite seeing their sales declining. In a nutshell, they believe in Autodesk’s business model which has seen the software creator change its business model from its focus on licensing to subscription services. As a result, the company has established a recurring revenue stream that is resulting in a price-to-sales ratio that has increased by 283% in the 12 months ending in April of 2018. And going forward, the company shows no signs of slowing down. Its product is unique to the industries it serves and it is benefiting from a growing customer base for their CAD/CAM software. Plus, by going to a subscription model, the company has lowered the cost of entry for getting customers up and running. And once these customers are on board, the perceived low subscription cost gives them a “sticky” relationship with their customers that provides the predictability that investors love.

Analysts are forecasting a 27% increase in revenue for 2019. The company’s stock is up over 121% since the beginning of 2015 and is currently trading around $149.

About Autodesk
Autodesk, Inc. operates as a design software and services company worldwide. The company offers AutoCAD, a professional design, drafting, detailing, and visualization software; AutoCAD Civil 3D, a surveying, design, analysis, and documentation solution for civil engineering, including land development, transportation, and environmental projects; AutoCAD LT, a professional drafting and detailing software; BIM 360, a construction management cloud-based software; computer-aided manufacturing (CAM) software for computer numeric control machining, inspection, and modelling for manufacturing; Fusion 360, a 3D CAD, CAM, and computer-aided engineering tool; and Industry Collections software products for professionals in architecture, engineering and construction, product design and manufacturing, and media and entertainment industries. It also provides Inventor tools for 3D mechanical design, simulation, analysis, tooling, visualization, and documentation; Maya and 3ds Max software products that offer 3D modeling, animation, effects, rendering, and compositing solutions; and PlanGrid, a cloud-based field collaboration software, which provides general contractors, subcontractors, owners, and architects access to construction information in real-time. In addition, the company offers Revit software for building information modeling; and Shotgun, a cloud-based software for review and production tracking in the media and entertainment industry. Autodesk, Inc. sells its products and services to customers directly, as well as through distributors and resellers. The company was founded in 1982 and is headquartered in San Rafael, California.

Current Price: $194.73
Consensus Rating: Hold
Ratings Breakdown: 12 Buy Ratings, 6 Hold Ratings, 3 Sell Ratings.
Consensus Price Target: $191.29 (-1.8% Upside)

#2 - Align Technology Inc. (NASDAQ:ALGN)

Align Technology logo

Align Technology Inc. (NASDAQ: ALGN)  - Align Technology is one of the few shining stars in the dental sector. The maker of Invisalign invisible braces and iTero Element intraoral scanner was recognized by Goldman Sachs as one of its top stocks for 2019 with an estimated 22% increase in revenue in the coming year. One of the key anticipated drivers of the company's growth is the popularity of the Invisalign product with a key demographic, millennials. From dating apps to job interviews, these consumers are recognizing the importance of a great smile, particularly with the higher resolution of smartphones. And this type of consumer benefit is not limited to the United States. There is a worldwide market for their products.

Align Technology recently signed an agreement with Aspen Dental for both its iTero scanner and Invisalign product. Aspen Dental is not only the largest network of branded dental care practices; it’s also experiencing tremendously rapid growth. Case in point, a new office opens every five days. In short, there’s a huge and growing market for their products.

Although the company’s stock is selling at a premium over $372 and a P/E ratio of over 89, one analyst considers them to be the best buy in dental despite their high valuation.

About Align Technology
Align Technology, Inc., a medical device company, designs, manufactures, and markets Invisalign clear aligners and iTero intraoral scanners and services for orthodontics, and restorative and aesthetic dentistry worldwide. It operates in two segments, Clear Aligner; and Scanners and Services. The Clear Aligner segment consists of comprehensive products, including Invisalign Comprehensive treatment that addresses the orthodontic needs of teenage patients, such as compliance indicators and compensation for tooth eruption; Invisalign Assist treatment, which offers support to dental practitioners throughout the treatment process, including progress tracking; and Invisalign First Phase I and Invisalign First Comprehensive Phase II package for younger patients with early mixed dentition with a mixture of primary/baby and permanent teeth. This segment's non-comprehensive products comprise Invisalign Express 10, Invisalign Express 5, Express Package, Lite Package, Invisalign Go, and SmileDirectClub; and non-case products include retention products, Invisalign training fees, and sales of ancillary products, such as cleaning material, and adjusting tools used by dental professionals during the course of treatment. The Scanners and Services segment offers restorative software for general practitioner dentists, prosthodontists, periodontists, and oral surgeons; software for orthodontists for digital records storage, orthodontic diagnosis, and for the fabrication of printed models and retainers; computer-aided design/computer-aided manufacturing services and ancillary products, such as disposable sleeves for the wand; and iTero applications and tools. The company was founded in 1997 and is headquartered in San Jose, California.

Current Price: $279.31
Consensus Rating: Buy
Ratings Breakdown: 8 Buy Ratings, 4 Hold Ratings, 0 Sell Ratings.
Consensus Price Target: $266.45 (-4.6% Upside)

#3 - Jagged Peak Energy Inc. (NYSE:JAG)

Jagged Peak Energy logo

Jagged Peak Energy Inc. (NYSE: JAG) - The energy sector is notoriously volatile but one company poised for massive growth in 2019 is Jagged Peak Energy. The Denver-based exploration and production (E&P) company have an expected 5-year growth rate of 76.4%, with a 61.5% growth rate in 2019. Most of its revenue comes from the oil and gas found in the southern Delaware basin in Texas. One of the reasons investors like JAG is that while other E&G companies saw a decline in revenue during the tough market of 2015 and 2016, JAG actually saw their revenues double during those years. And if that wasn't enough they tripled their revenue in 2017.

Currently, the company is forecasting 2018 profits to come in at 27 cents per share. That number, however, is forecast to rise to 76 cents per share in 2019 and rising above a dollar per share in 2020. The stock does not have a long history, and with the stock trading at just over $12 per share, it’s down about 10% from its initial public offering (IPO).

About Jagged Peak Energy
Jagged Peak Energy Inc. operates as an independent oil and natural gas company. The company focuses on the acquisition and development of unconventional oil and associated liquids-rich natural gas reserves in the Southern Delaware basin, a sub-basin of the Permian basin of West Texas. As of December 31, 2018, it held an 87% average working interest in approximately 79,500 net acres with an estimated net proved reserves of 118,890 thousand barrel of oil equivalent, as well as owned a 89% average working interest in 143 net productive wells. Jagged Peak Energy Inc. was founded in 2013 and is headquartered in Denver, Colorado.

Current Price: $8.23
Consensus Rating: Buy
Ratings Breakdown: 7 Buy Ratings, 7 Hold Ratings, 0 Sell Ratings.
Consensus Price Target: $10.58 (28.6% Upside)

#4 - ResMed Inc (NYSE:RMD)

ResMed logo

ResMed Inc. (NYSE: RMD) - ResMed is a proven performer in the field of medical devices and cloud-based software applications. The company's stock has seen a 47% year-over-year growth. This not only dwarfs the industry's growth of 15%, but it also beats the S&P 500's average of 12.5%. ResMed’s 9.3% historical growth rate also beats its industry average of 6.9%. A key reason for the stock’s performance is that the company’s products target two medical conditions, sleep apnea and chronic obstructive pulmonary disease (COPD), which gives it a market that has grown to two million patients daily. This allows it to help patients while helping reduce healthcare costs. A win-win that has allowed the company to deliver an annual return to its shareholders of nearly 12 percent (11.9%), which is 478 basis points higher than the S&P 500.

The market for its products shows no signs of shrinking. A recent study cites that approximately 1 in 4 adults has sleep apnea. And COPD is a disease that affects more than 200 million worldwide and is the reason for over $50 billion in health-care costs in just the United States. And that's an important point. Because in addition to its growth in the United States, the company is reporting expansion opportunities in large markets such as Latin America, Eastern Europe, China, and India.

About ResMed
ResMed Inc. develops, manufactures, distributes, and markets medical devices and cloud-based software applications that diagnose, treat, and manage respiratory disorders comprising sleep disordered breathing, chronic obstructive pulmonary disease, neuromuscular disease, and other chronic diseases. It offers various products and solutions for a range of respiratory disorders, including technologies to be applied in medical and consumer products, ventilation devices, diagnostic products, mask systems for use in the hospital and home, headgear and other accessories, dental devices, portable oxygen concentrators, and cloud-based software informatics solutions to manage patient outcomes, as well as provides customer and business processes. The company also provides humidifiers, carry bags, and breathing circuits; data communications and control products, such as AirView Diagnostics, EasyCare, ResLink, ResControl, ResControl II, TxControl, ResScan, and ResTraxx modules; U-Sleep, which enables automated patient coaching through a text, email, or interactive voice phone call; and myAir, a patient engagement application that provides sleep data and a daily score based on their previous night's data, as well as offers business management software and services to medical equipment and home health providers. It markets its products to sleep clinics, home healthcare dealers, patients, hospitals, physicians, and third-party payers through a network of distributors and direct sales force in approximately 120 countries. ResMed Inc. was founded in 1989 and is headquartered in San Diego, California.

Current Price: $164.38
Consensus Rating: Buy
Ratings Breakdown: 4 Buy Ratings, 4 Hold Ratings, 0 Sell Ratings.
Consensus Price Target: $118.33 (-28.0% Upside)

#5 - Five Below Inc. (NASDAQ:FIVE)

Five Below logo

Five Below Inc. (NASDAQ: FIVE) - Teenagers and clothes go together like peanut butter and jelly. The presence of a market that’s not going away anytime soon underpins the stock’s performance. But how does that translate to the real world. Same-store sales increased by 2% in the company’s 2016 fiscal year. In retail, when brick-and-mortar stores are still going out of business at an alarming rate, that number speaks loudly. So what’s the secret? They make discount shopping chic. And when you’re competing with an online behemoth like Amazon, not to mention proven performers like WalMart, you have to give consumers a reason to shop with you. FIVE relies on a concept that prices items at $5 and below. This model is not only attractive to their pre-teen and teenage audience, but also to their parents. And Five Below is betting on themselves by continually opening stores and has a plan to grow revenues by 20% every year until 2020 and beyond.

About Five Below
Five Below, Inc. operates as a specialty value retailer in the United States. It offers accessories, including novelty socks, sunglasses, jewelry, scarves, gloves, hair accessories, athletic tops and bottoms, and T-shirts, as well as nail polishes, lip glosses, fragrances, and branded cosmetics; and items used to complete and personalize living space, including glitter lamps, posters, frames, fleece blankets, plush items, pillows, candles, incense, lighting, novelty décor, and related items, as well as provides storage options for the customers room. The company also provides sport balls; team sports merchandise and fitness accessories, such as hand weights, jump ropes, and gym balls; games, including name brand board games, puzzles, collectibles, and toys covering remote control; and pool, beach, and outdoor toys, games, and accessories. In addition, it offers accessories, such as cases, chargers, headphones, and other related items for cell phones, tablets, audio, and computers; books, video games, and DVDs; craft activity kits; arts and crafts supplies that consist of crayons, markers, and stickers; and trend-right items for school comprising backpacks, fashion notebooks and journals, novelty pens and pencils, locker accessories, and everyday name brand items. Further, the company provides party goods, decorations, gag gifts, and greeting cards, as well as every day and special occasion merchandise products; assortment of classic and novelty candy bars, movie-size box candy, seasonal-related candy, and gum and snack food; chilled drinks through coolers; and seasonally-specific items used to celebrate and decorate for events. It primarily serves tween and teen customers. As of February 2, 2019, Five Below, Inc. operated 750 stores. The company was formerly known as Cheap Holdings, Inc. and changed its name to Five Below, Inc. in August 2002. Five Below, Inc. was founded in 2002 and is headquartered in Philadelphia, Pennsylvania.

Current Price: $115.65
Consensus Rating: Buy
Ratings Breakdown: 15 Buy Ratings, 4 Hold Ratings, 0 Sell Ratings.
Consensus Price Target: $138.94 (20.1% Upside)

#6 - Ulta Beauty (NASDAQ:ULTA)

Ulta Beauty logo

Ulta Beauty (NASDAQ: ULTA) - Another retail play for 2019 is Ulta Beauty. This Illinois-based company is another example of a company that is opening stores at a time when the overall trend is to closing stores. As of January 2017, the company operates 974 stores and has plans to expand that footprint to 1,700 stores over the next 10 years. A common theme for successful businesses in general, and brick-and-mortar retail, in particular, is the ability to create a differentiated customer experience. Ulta provides their customers with such an experience which allows them to be a strong niche player in a market where no one company has a large market share. In fact, the real story of Ulta is not where they are, it's where they're going. The company has just 4% of the $127 billion market. However, the company has annual revenue totaling nearly $5 billion. And as long as consumer confidence remains high, the company should continue to grow their customer base, because the skincare/cosmetic industry proves to be resilient in any market. 

About Ulta Beauty
Ulta Beauty, Inc. operates as a beauty retailer in the United States. The company's stores offer cosmetics, fragrances, skincare and haircare products, bath and body products, and salon styling tools; salon services, including hair, skin, makeup, and brow services; and others, including nail products and accessories. It also provides private label products, such as the Ulta Beauty Collection branded cosmetics, skincare, and bath products, as well as Ulta Beauty branded products. As of February 2, 2019, the company operated 1,174 retail stores across 50 states. It also distributes its products through its Website, ulta.com. The company was formerly known as Ulta Salon, Cosmetics & Fragrance, Inc. and changed its name to Ulta Beauty, Inc. in January 2017. Ulta Beauty, Inc. was founded in 1990 and is based in Bolingbrook, Illinois.

Current Price: $273.92
Consensus Rating: Hold
Ratings Breakdown: 12 Buy Ratings, 10 Hold Ratings, 1 Sell Ratings.
Consensus Price Target: $283.73 (3.6% Upside)

#7 - Century Aluminum (NASDAQ:CENX)

Century Aluminum logo

Century Aluminum (NASDAQ: CENX) - Tariff stocks will continue to be in the news in 2019. But it’s important for investors to pick the right ones. Century Aluminum is projected to reach 117.7% growth in 2018, 154% in 2019, and has an expected 5-year growth rate of 154%. Century Aluminum is the second-largest producer of aluminum and is looking to grow as it restarts idled capacity. What analysts are looking for from CENX is consistency. They have become used to seeing the up-and-down performance in the company's top-line and bottom line performance. But since a strong 2017 (net profit came in at 51 cents per share), they are enjoying hearing the company anticipating that not only will they remain profitable in 2018, but they should increase their growth to around 82 cents per share. They are also projecting 2019 to be even better at $2.12 per share. This increased growth in forward earnings should help dramatically lower their P/E (currently just over 15) to a much more appealing multiple at just above 7.

The stock is currently trading at just over $12.20 per share, but with consistent profit results giving investors confidence in future growth, some analysts are seeing the stock tripling in value from today’s levels. 

About Century Aluminum
Century Aluminum Company, together with its subsidiaries, produces standard-grade and value-added primary aluminum products in the United States and Iceland. The company was founded in 1995 and is headquartered in Chicago, Illinois.

Current Price: $6.66
Consensus Rating: Buy
Ratings Breakdown: 1 Buy Ratings, 1 Hold Ratings, 0 Sell Ratings.
Consensus Price Target: $12.00 (80.2% Upside)

For investors looking to find growth stocks, they will often look at metrics like the price-to-earnings (P/E) ratio to ensure that they are not buying stocks that are overvalued. However because the P/E ratio can be an indicator of value, it can work as a hindrance to growth.

If you’re looking for rapid growth, you often need to look at stocks that may appear, at first glance, to be overvalued. In this context, a higher P/E ratio can be the catalyst that pushes a stock’s price higher. But that doesn’t mean you have to be limited to stocks like Amazon and Apple. While it would be hard to argue that these stocks don’t present exceptional growth opportunities for 2019, there are other options for investors that may cost them a fraction of the per share cost of these behemoths.

The stocks in this report all have attractive earnings per share (EPS) growth outlooks that are making them candidates for monster growth not only right now but beyond. For investors, they reflect the best of both worlds, they can provide exceptional short-term growth with a reason to hold them and reap the benefits for several years.

More on MarketBeat
13 Stocks Institutional Investors Won13 Stocks Institutional Investors Won't Stop Buying
15 Stocks that Insiders Love15 Stocks that Insiders Love
15 REITS Analysts Can15 REITS Analysts Can't Stop Recommending
Top Ten Brokerages You Can TrustTop Ten Brokerages You Can Trust
10 Canadian Growth Stocks to Buy Now10 Canadian Growth Stocks to Buy Now
20 High-Yield Dividend Stocks that Could Ruin Your Retirement Portfolio20 High-Yield Dividend Stocks that Could Ruin Your Retirement Portfolio
20 Stocks Wall Street Analysts Love the Most20 Stocks Wall Street Analysts Love the Most

Enter your email address below to receive a concise daily summary of analysts' upgrades, downgrades and new coverage with MarketBeat.com's FREE daily email newsletter.

Yahoo Gemini Pixel