4 Top Growth Stocks to Buy for Next Year

Growth stocks, primarily in the technology sector, have witnessed a massive rally since the mid-March market slump. These companies have benefited from the change in consumer behavior and digital transformation caused by the pandemic…

The market-beating performance of growth stocks is evident from the SPDR Portfolio S&P 500 Growth ETF’s (SPYG) 30.7% year-to-date gain versus the broader S&P 500 index’s 14.8% returns.

These growth stocks are expected to continue their momentum in 2021 as well. Even though the vaccination process has started in the United States, it will take some time for the economy to reflect the impact. So, the demand for technology is expected to remain high in the upcoming quarters. Transformation in the way many companies operate could be permanent.

Companies like Amazon.com, Inc. (AMZN – Get Rating), PayPal Holdings, Inc. (PYPL – Get Rating), Advanced Micro Devices, Inc. (AMD – Get Rating), and Logitech International (LOGI – Get Rating) have seen significant gains this year. They have witnessed high revenues and EPS growth amid the pandemic and are well-positioned to see improve their financials further in the upcoming quarters. These companies are also innovating quickly to meet evolving customer needs.

Amazon.com, Inc. (AMZN – Get Rating)

AMZN needs no introduction. In addition to e-commerce, the company also provides cloud services through Amazon Web Services (AWS) to enterprise customers. AMZN’s stock has gained 73.3% so far this year.

AMZN has recently started to provide translation-on-the-go services through its Alexa smart-home device. AMZN is also poised to enter the online pharmacy business through Amazon Pharmacy which will deliver pharmaceutical products. This move could greatly increase the market capitalization for AMZN.

AMZN’s revenue grew at a CAGR of 28.2% over the last five years. The company’s EBITDA grew at a CAGR of 50.1% over the last three years.

AMZN is expected to see revenue growth of 36.7% for the quarter ended December 2020 and 18.3% in 2021. The company’s EPS is estimated to…

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