US Growth Stocks With The Best Q2 2022 Earnings: Should You Buy Now?
September 16 2022 - Team Stockal
An Overview – Best US Stocks To Buy Now
One of the two basic fundamental investment techniques is growth investing, the other being value investing. Growth investors often invest the bulk of their portfolio in growth stocks, which are shares of firms whose profits or sales are predicted to increase considerably faster than the rest of the market. At this point in their industry’s life cycle, these firms typically do not pay dividends since all earnings are typically reinvested into the company to produce even more earnings or revenue in the future. Capital gains are the primary way that investors hope to benefit from growth investment.
The rest of 2022 is expected to be hard for the US economy because the Fed Funds Rate is going up from 0% to 2.25%. This is because US inflation is rising and is now at 9%. Rate increases are likely to keep happening for the rest of the year. Since this is the case, stocks tend to underperform overall. This means that now is a good time to pick your stocks carefully and take advantage of the rebound in companies with strong profit growth. How can you locate the best growth stocks to buy in India in a bleak economic scenario?
How To Find The Best US Stocks To Buy Now In A Gloomy Economic Environment?
For most of the last decade, investors could put money into the market and almost always see their balances climb. And, after a recession in 2020, markets resumed their ascent, reaching record highs until recently.
With the worst inflation rate in 40 years, increasing interest rates, stock indices dropping by double digits, and economic uncertainty, finding a spot to invest in equities and get a fair return is becoming more difficult. However, financial gurus believe it is still doable. The first piece of advice is that as the economy changes, investors must adjust as well.
- Focus On US Growth Stocks Which Have Underperformed Recently, But The Long Term Story Remains Intact
Growth investors often seek investments in fast-growing sectors that are developing new technology and services. Growth investors seek profits via capital appreciation, or the gains they will realise when they sell their shares (as opposed to dividends they receive while they own it). In reality, rather than providing a dividend to shareholders, most growth-stock businesses reinvest their profits back into the company.
These are often small, young businesses with great promise. They might also be corporations that have just recently begun trading publicly. The premise is that the firm will succeed and grow, and that this increase in profits or sales would ultimately convert into higher stock prices. As a result, growth companies may trade at a high price/earnings (P/E) ratio. They may not be making money right now, but they are anticipated to in the future. This is due to the fact that they may have patents or have access to technology that puts them ahead of their competitors in their field. To keep ahead of the competition, companies spend revenues in developing even better technology, and they seek patents to assure long-term prosperity. Growth investing is also characterised as a capital growth strategy or a capital appreciation strategy since investors attempt to maximise their capital gains.
- Focus On Companies Which Have Reported Strong Financials In The Latest Quarter Despite Challenging Overall Outlook
The underlying idea behind regular value investing is simple: knowing the actual worth of something allows you to save a lot of money when you purchase it on sale. Most people would agree that you receive the same screen size and visual quality if you purchase a new TV on sale or at full price. Stocks operate in a similar fashion, which means that the company’s stock price might move even if the company’s worth or valuation remains constant. Stocks have periods of greater and lower demand, resulting in price fluctuations—but this has no bearing on what you receive for your money.
Just as wise consumers would say that paying full price for a TV makes little sense since TVs go on sale multiple times a year, clever value investors think stocks function the same way. Stocks, unlike televisions, will not go on sale during certain periods of the year, such as the festive season, and their pricing will not be announced. The technique of undertaking detective work to identify these hidden deals on stocks and purchase them at a discount to how the market values them is known as value investing. Investors might be handsomely rewarded for purchasing and keeping these bargain companies for the long term.
According to our strategy, let’s look at some of the US growth stocks with the strongest earnings performance this quarter.
- Airbnb: is a service that allows property owners to rent their properties to tourists searching for a place to stay. Travellers may hire a room for a group, a shared room with separate rooms, or a full house for themselves. This was the company’s most lucrative second quarter in history. With revenue of $379 million, a roughly $700 million increase over the previous quarter. Revenue in the quarter was $2.1 billion, up 58% from the same time a year ago and 73% over Q2 of 2019. Airbnb earned $379 million in net profits, up from a loss of $68 million in the previous quarter.
- Booking Holdings Inc: It is the world’s top supplier of online travel and associated services, with six core brands serving customers and local partners in over 220 countries and territories: Priceline, Booking.com, Rentalcars.com, Agoda, KAYAK, and OpenTable. Booking Holdings Inc’s sales increased 98.8% year on year to $4,294 Mn in the second quarter of 2022. The net income for the second quarter of 2022 was $857 million, compared to a net loss of $167 million the previous year. In the second quarter of 2022, net income per diluted common share was $21.07, compared to a net loss per diluted common share of $4.08 in the prior-year period.
- NextEra Energy Inc: It is an American energy corporation with over 58 GW of producing capacity (24 GW from fossil fuel sources) and around 14,900 people throughout the United States and Canada. By market capitalization, it is the biggest electric utility holding corporation. NextEra Energy Inc, the largest generator of renewable energy in the United States, outperformed Wall Street expectations for second-quarter earnings, thanks to increased demand for clean energy. NextEra Energy’s adjusted second-quarter profits in 2022 were $1,593 million, or $0.81 per share, compared to $1,395 million, or $0.71 per share, in the second quarter of 2021.
- Expedia: It is one of the world’s leading full-service online travel brands, assisting travellers in easily planning and booking their entire trip by offering the most comprehensive selection of vacation packages, hotels, flights, rental cars, vacation rentals, activities, cruises, attractions, and services. The Seattle-based online travel company earned $1.96 per share and increased sales by more than 50% year on year to $3.18 billion. Analysts had predicted $1.56 billion and $2.99 billion, respectively. Gross bookings grew 26% year on year to $26.14B in the third quarter. Revenue per ticket increased by 21% in the company’s smaller air travel services sector. The top line led to an adjusted EBITDA of $648 million, more than doubling from $201 million the previous year and 14% higher than the second quarter of 2019.
- DigitalOcean Holdings Inc: Through its subsidiaries, the Company offers on-demand infrastructure and platform tools to start-ups, developers and small and medium-sized organisations in order for them to create, implement, and grow software applications. DigitalOcean Holdings services consumers all around the globe. Digital Ocean reported higher-than-expected June quarter profit while raising its full-year profits and cash flow forecast. DigitalOcean Holdings reported $0.20 per share in quarterly profits, exceeding the Zacks Consensus Estimate of $0.10 per share. This is compared to profits per share of $0.07 a year ago. These values have been modified to account for non-recurring items.
Due to rising expenses and market volatility, active stock selection tactics have lately failed to beat passive investing strategies. As a result, it is wise to employ Stacks or an ETF for the sectors you are interested in. Stockal is available to assist in any situation: Direct or indirect investment.
How To Invest In US Growth Stocks From India?
You’ve come to the right place if you’re wondering how to invest in US growth stocks from India. There are two methods to invest:
- Direct Investments: The Stockal app allows you to invest directly in US growth stocks. Its zero-cost approach enables customers to begin trading immediately without incurring any account opening fees or commissions on purchases and sales. Opening a US stocks account with Stockal takes less than 2 minutes.
- Indirect Investments: There are two ways to indirectly invest in US growth stocks. You may put your money into mutual funds that track the US index. Exchange-traded Funds are another way to acquire exposure to US equities. ETFs are one of the cheapest options to invest in US stocks from India. An ETF is a grouping of many equities that are traded as a fund. They are comparable to mutual funds. The distinction is that they are passive funds, which means that the underlying equities follow an index. One can begin US stock trading from India by purchasing ETFs that are accessible in India. You may also use the Stockal app to invest in US ETFs to spread your risk while profiting from US stock market gains. You may choose from a large choice of ETFs with Stockal.
Consider your goals and risk tolerance before investing in growth stocks. US growth stocks are excellent for investors with a high risk tolerance who are investing for long-term objectives such as retirement; they are typically not appropriate for people nearing retirement age or who need to produce income. Growth equities should be a fundamental component of portfolio allocation for long-term investors who are fine with some volatility.
The US dollar is the world’s reserve currency, and as long as it is, it will have a significant edge over most other currencies. With the Indian rupee falling in value against the US dollar, it is advisable to consider investing in US markets to protect your wealth from the rupee’s collapse.
If you are ready to take the first step, establish an account with Stockal, which provides a SIMPLE, SMART and SECURE investing and trading platform. Stockal is one of the best apps for US stock markets investing and trading from India, and provides SIPC protection of up to $5,000,000.
Choose an intelligent friend to accompany you on your quest to invest in US growth stocks. Visit Stockal’s website for further information on how to invest in the best growth stocks to buy now in India.