- Etsy’s recent acquisitions are acting as a catalyst for the company’s growth.
- Thanks to its reconstruction over the years, Tesla has skyrocketed to become one of the biggest stocks in the market today.
- Remote work and learning will grow over the long term, expanding Zoom's addressable market.
Buying a stock is easy, but not when it comes to buying the right stock without a time-tested strategy. So here is a simple guide to the 3 explosive stocks to buy right now or put on a watchlist.
Investors are constantly looking to invest in stocks that have a lot of room for growth. The COVID pandemic has changed various business trends, adding value to enterprises across many key sectors.
A well-diversified portfolio is crucial for most. Keeping these and many other considerations in mind, we have compiled a list of the three stocks that are likely to generate sizable returns in the future.
Some of the popular value stocks on the market are Etsy, Tesla, Zoom, among many others. These firms have delivered solid earnings and remained relatively immune from economic recessions over the past few years, in part because of the competitive edge of their products and services over peers.
3 Explosive Stocks to Buy Right Now
1. Etsy (ETSY)
Etsy is an e-commerce platform where creators of arts, crafts, vintage items, and other unique goods can sell their products. Etsy was a big beneficiary of the COVID-19 pandemic. Stuck-at-home shoppers turned to Etsy and other online retailers for both essential and non-essential items.
In June, Etsy announced a deal to buy Depop, a fashion resale app popular with Gen Z shoppers, for $1.6 billion. Etsy also recently acquired Brazil-based marketplace Elo7 for an undisclosed amount, which extended Etsy's addressable market to one of the fastest-growing e-commerce regions in the world.
Over the last year, Etsy has seen robust growth across numerous retail categories, including apparel, jewellery, and personal care items. For example, apparel gross merchandise sales (GMS) were up 83% year over year in the first quarter. But Depop's niche focus in the vintage, second-hand fashion market has allowed it to grow even faster.
While apparel is not Etsy's largest category, it represents Etsy's long-term growth opportunity. Apparel is the top e-commerce market, worth an estimated $364 billion, and is expected to grow at a compound annual rate of 9% through 2025.
With Depop, Etsy is getting a fast-growing brand that has a solid presence on mobile. One estimate puts the expected growth of the second-hand market at 39% from 2019 through 2024, reaching $64 billion.
It is worth buying the Etsy stock now because investors are starting to view acquisitions as a growth catalyst for Etsy, making it a stellar investment choice.
2. Tesla (TSLA)
Tesla is currently one of the stock market’s hottest offerings. Elon Musk, Tesla’s outspoken CEO and founder, has managed to successfully turn what once seemed like a pipe dream into the dominant electric vehicle (EV) company.
Tesla reported that it delivered 201,250 vehicles in the second quarter of 2021, up from the prior record of 184,800 in the first quarter. Deliveries soared 120% from the year-ago period. Tesla plans to build its first Model Y vehicles in Berlin and Austin in 2021. But the company said that its semi-electric big-rig truck would not arrive until next year. It also suggested the Cybertruck may not start coming off the assembly line until 2022 after Musk previously said it could happen late this year.
Shares for Tesla stock have risen well over the years leading to its new highs in 2020. It currently sits at $645.00 per share, forward from March 1st, 2019, where the stock closed at $58.96 per share. The consumer demand is heavy, and the company's reconstruction over the years has caused Tesla to become one of the biggest stocks on the market today.
The fact that the EV company sits in a healthy financial position is another major benefit. Free cash flow and sufficient liquidity enable the company to fund future projects for long-term expansion. This will have a knock-on effect on the company’s profit as the company is looking to continue its industry-leading highs along with expecting its operating margin to continue to grow throughout the future.
Tesla continues to develop in all areas, expanding new factory facilities across the globe to build their in-demand products but concentrating on the rapid expansion of moving the world into an eco-friendly environment with EV’s and energy-efficient battery technology.
Buying TSLA stock now could help you generate massive long-term returns.
3. Zoom (ZM)
Zoom's cloud-based service allows people in different locations with different devices to connect face-to-face and share content via video, voice, and chat. During the COVID pandemic, people have increasingly turned to the service. Zoom has claimed that it served 10 million daily meeting participants in December 2019 and more than 300 million per day in April 2020.
Zoom may never again be as buzzworthy as it was during the height of the pandemic when lockdowns drove workplaces, schools, and other communities to adopt video-conferencing technology. But Zoom's recent results and guidance make it clear that hybrid work is here to stay.
Revenue in the first quarter of 2021 surged 191% to $956 million, easily eclipsing the company's guidance and the analyst consensus. Though some investors are concerned about threats from tech giants like Microsoft and Google, Zoom is enhancing its platform to make its independence an asset. The company recently reintroduced its software development kit to allow developers to embed Zoom technology in another app, adding to its utility and strengthening its competitive advantages.
While the pandemic tailwinds will fade, there is little doubt that remote work and learning will grow over the long term, expanding Zoom's addressable market. For this and more reasons, buying ZM stock now could help you double your investment.
The stock market can be volatile at times. Therefore, investors need to conduct due research before investing. However, after considering the points mentioned above, one could admit that Etsy, Tesla, and Zoom are the 3 explosive stocks to buy right now as they have the potential to generate massive returns in the future.
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