If your dream is to become a millionaire through investing, then here are 7 top stocks that can make your dream become a reality.
As we make our way into the second half of 2021 many investors couldn't see the market sustaining amazing results that it has witnessed in 2020. But analysts and investors alike have witnessed this bull market continue throughout the year with the leading S&P 500 index having jumped up to 18% so far in 2021. Alongside, Goldman Sachs raised its guidance forecasting that the leading index will gain another 7% before the year is out. As it stands both the Dow Jones Industrial Average is up 15%, with the NASDAQ being up around 14.77% YTD.
With the above information in mind when it comes to looking at becoming a millionaire hit-maker for the average investor, it's worth noting that this achievement is possible as stocks perform over time meaning that it pays to invest for the long term in order to reach your goal.
A great way to look at which stocks are the best fit to give you that millionaire status is by using the popular formula, Rule of 72. This formula can help you calculate how long a time period it will take for your investment to double in value. For example, if an investment returns around 8% per year it will calculate 72/8=9 which in effect accumulates to nine years in order for your investment to double in value.
As we can see that it takes a longer period of time in order to achieve millionaire status, it is also worth noting that investors want to look at stocks that look to have a clear innovative path ahead in order to gain greater returns in the long run.
On that note here we have picked top stocks to buy on the market right now that look set to make you a millionaire.
Best 7 Stocks to Buy that Could Make You a Millionaire
Seven millionare-maker stocks to buy:
- Zillow Group (ZG)
- Pinterest Inc (PINS)
- Etsy (ETSY)
- Uber Technologies (UBER)
- Facebook (FB)
- PayPal (PYPL)
- Square (SQ)
Zillow Group (ZG)
52-week range: $73.48 - $208.11
Zillow Group Inc (ZG) is an American online real estate company that is changing the way within the real estate world by pushing the market further into the digital world.
Originally starting out as a media company and focusing on advertisements, Zillow is now one of the fastest-growing real estate marketplaces on the market as it allows customers to look to buy, sell, rent, secure home loans, pay rent and much more all at their own convenience. Zillow also offers sellers the option for the group to buy their home through its Zillow Offers business model, where the brand will offer an all cash offer in order make the transition quicker for home owners that don’t wish to enter the market.
In 2020 it was reported that Zillow was one of the most visited real estate websites pulling in a record 9.5 billion views through Zillow’s mobile apps and websites, up by 1.5 billion visits or 19% from the previous year. This result led to an increase of 24% YoY in sold properties in 2020.
Moving into the second quarter of 2021, ZW has witnessed momentum vastly pick up from 2020. Total revenues surpassed Zacks Consensus Estimate by 3.4% to $1.31 billion, the stocks Total Homes segment revenues increased by 71.1% to $777.1 million, Zillow Offers revenues gained 70% year-over-year to $772 million and the company’s Other segments revenues reached $5.1 million compared to $0.4 million within the same quarter YoY.
All these results accumulated to Q2 net income of $10 million with gross profit reaching $538 million, up by 92% YoY.
Zillow also sits in a profitable position with the company ending Q2 2021 with cash and investments totalling to $4.6 billion which will help enable further expansion.
According to Zillow Group’s co-founder and CEO Rich Barton, Barton expects the housing market to continue its upward trends thanks to interest rates remaining low and individuals' flexible working patterns contributing to fuel additional growth for the stock.
Zillow’s Offers segment continues to be one of the company’s main focuses for the year and is poised to reach revenue of between $1.4 - $1.5 billion in Q3, up from $777 million in Q2.
Following the release of the stock's Q2 earnings report ZW stock managed to gain by 1.08% in after hours trading, despite the stock being down roughly around 28% over 2021.
Currently, ZW is trading at a discounted price of $101.50, with Zacks Investment Research expecting earnings to grow by a growth rate of 16.40% over the coming 3-5 year outlook. Zillow currently holds a forward price-to-earnings ratio (P/E) and a P/B ratio of 96.26 and 4.46 respectively.
2. Pinterest (PINS)
52-week range: $32.49 - $89.90
Pinterest (PINS), the image sharing platform that has had and is continuing to have a great run in 2021 has once again beat revenue and earnings within its recent quarter.
Pinterest had a fantastic run in 2020, witnessing its revenue rise by just under 50% to $1.69 million for the year and reaching over 450 million monthly active users globally. Fast forward to 2021, the stock managed to reach a revenue of $613 million, confirming a rise of 125% YoY with earnings rising to $0.25 per share for the quarter. Both results exceeded estimates.
Despite PINS confirming a growth in monthly active users (MAU’s) by 9% to 454 million YoY, the company did confirm that MAU’s within the US decreased by 5% and has continued facing headwinds moving into the third quarter as the stock decreased by 7% as of July 2021. Yet global MAU’s have grown approximately 5% over the year so far.
Following this news caused PINS stock to take a hit of around 25% within its shares which was brought on due to the ease of COVID-19 restrictions globally as individuals continue to seek adventure rather than staying home. Yet Pinterest’s shares are currently up around 68% so far in 2021.
Moving to Q3 PINS has not given guidance of where it expects MAU’s to end for the quarter, giving the uncertainty that surrounds the ongoing COVID-19 delta variant. But the stock has forecast that revenue will reach just below 40% for Q3 with analysts predicting that the stock's revenue could see a 17.73% rise to $2.6 billion for the year.
Pinterest Inc’s priorities moving forward are to continue evolving its strategic plans as the stock seeks to remain strong within its content, advertising and shopping segment including the stock’s partnership with Shopifiy which should continue to draw in additional users globally increasing headcount.
With an attractive price-to-sales (P/S) ratio of 16.20 over other popular social media stocks, PINS looks to be a fantastic growth stock if it can sustain topline results including continuing to gain on MAU’s over the coming years. To conclude, Pinterest is a stock that is set for the long haul leaving movements within short term ones that investors should not take hard when you look at the bigger image of what this company is setting out to achieve.
3. Etsy (ETSY)
52-week range: $103.06 - $251.86
Similar to Pinterest (PINS), this next stock which is strictly just an e-commerce platform that connects buyers and sellers to uniquely crafted products that has also been compared to the giant stock Amazon (AMZN) is the American e-commerce company Etsy Inc (ETSY).
ETSY stock rose significantly in 2020, rising by 110% in revenue to $1.7 billion with gross merchant sales (GMS) growing to an impressive $10.28 billion, up by 106.7% year-over-year. These results pushed the stock to become one of the top 10 largest e-commerce businesses in the world, and also gained more than 4.3 million sellers and over 39 billion buyers worldwide.
Moving into 2021, the stock has released its Q2 2021 results that has once again blown past analysts estimates with revenue reaching $528.9 million, a 23% increase YoY with its earnings rising to $0.68 per share, gaining slightly above analysts estimates of $0.63 cents per share for the quarter.
Even though ETSY is still continuing to beat expectations, the stock has now witnessed a pullback within its shares as they declined by approximately 14% after trading following the company’s news that it predicts sales will slow further leading into Q3.
During 2020, the Etsy marketplace saw a rise in unique face masks which contributed significantly within its own right to the sales outcome. But as we edge closer through new normal times face masks are no longer mandatory in certain countries which is one of the main factors why investors are concerned about the stocks future performance. But according to CEO Josh Silverman, excluding face masks Q2 GMS increased by 31% confirming that growth is still apparent in other areas.
ETSY has also given the go ahead to buy two leading brands Depop and Elo7 that look set to increase sales and look to add further value to the stock with both deals due to be completed within the third quarter.
With this in mind ETSY is looking to achieve revenue for the third quarter of between $500- $525 million, slightly below analysts estimates of $527 million for Q3. Whilst analysts further predict revenue to reach $2.3 billion for the year, showing a 5.54% increase YoY.
ETSY stock has gained over 50% over the past year and holds a P/S ratio of 12.49. This slight pullback shouldn't be of any concern when taking into consideration this stock's clever acquisition plans and its evolving e-commerce ecosystem that will continue to draw in millions globally.
4. Uber Technologies (UBER)
52-week range: $28.48 - $64.08
Uber Technologies Inc (UBER) or more commonly known as Uber, is an American tech company that prides itself on transporting people, food, package deliveries and much more to individuals across the globe.
Within the stock's recent Q2 2021 report, UBER managed to beat estimates respectively and is setting its sights on becoming profitable on an adjusted EBITDA basis by Q4.
Over the course of 2020, UBER witnessed a huge decline in most segments. But thanks to the brand’s UBER eats segment the company managed to keep afloat over the year as it generated revenue of $4.8 million in 2020 with delivery (gross bookings) revenue of $12.9 million, up by 85% YoY.
According to the stock’s recent Q2 2021 report, UBER managed to beat earnings estimates by gaining an EPS of $0.58, a significant rise from analysts estimates of -$0.46 per share for the quarter. This marks the first positive EPS result over the past 13 quarters according to reports. Revenue came in at $3.9 billion against analysts estimates of $3.7 billion, confirming that UBER has gained 105.4% YoY.
Uber’s future growth plans is to continue evolving its recovery investments of new drivers in 2021. As global restrictions eased, this stock added a further 30% more drivers within the US from June to July on top of the almost 450,000 drivers that the company hired at the start of the year as trips on the platform rose by 105% YoY.
UBER is currently trading at $43.50 upon writing this report, alongside holding a P/S ratio of 7.71 indicating that the stock is sitting in a potential undervalued position. Furthermore, analysts are predicting that this stock could see a 95% rise within its share price to $85.00 in 2021 as delivery transportation picks up with revenue anticipated to reach just under 34% to $16.3 billion for the year.
5. Facebook (FB)
52-week range: $244.31 - $377.55
No matter what challenges are happening in the world, it's wise for investors to stick to stocks that have a clear solid core business model to ride the storm. Welcome Facebook (FB) to the list.
Aside from Facebook this social media giant also owns Instagram, Whatsapp, Messenger and its latest creation entering into the virtual reality world, its Oculus brand.
In Q2 2021, FB stock’s revenue grew by 56% YoY with revenue reaching $29.08 billion for the first quarter beating analysts' predictions of $27.89 billion, net income reached $10 billion for the quarter following on from the success from Q1 2021 where net income grew by 94%, earnings gained a rise of $3.61 per share from $3.30 per share it gained in Q1 2021 and facebook’s free cash flow came in slightly below expectations at $8.51 billion. The company’s Other segment which includes its virtual avenue with its Oculus virtual reality headsets rose revenue by 36% to $497 million.
These results confirmed that Q2 2021 was the stock's fastest growing month in over five years.
Looking ahead, the company stated that “year-over-year total revenue growth rates to decelerate significantly on a sequential basis as we lap periods of increasing strong growth”. Following this news the stock witnessed a decline of around 5% in after hours trading. In addition, Facebook’s ongoing legal challenges have not helped this stock and has caused many investors to overlook its visible value potential.
On that note, Facebook’s growth plans are looking solid as Facebook’s CEO Mark Zuckerberg’s vision of making the stock a “metaverse” company is in full swing. This huge growth prospect will drive a new wave of consumers and increase sales within the digital space to deliver more value for shareholders.
Facebook is looking on course to deliver another double-digit growth to shareholders in 2021, with analysts predicting this stock to reach earnings for the year of $14.10 per share, up by 3.02 YoY.
Aside, FB holds an average medium price target of $450, showing a 25% increase from where the stock sits today. Despite this stock looking slightly overvalued, FB has the growth to back it up making this stock a great long term investment that can give you those six digits in the long term.
6. PayPal (PYPL)
52-week range: $171.63 - $310.16
One of the first of two fintech companies that has the makings of making investors wealthy over time is PayPal (PYPL).
PayPal’s online payment solutions offers a combination of it all from PayPal, Pal Credit, Braintree and much more that seeks to support money transactions in digital form. According to data, PYPL is one of the top 5 most used digital payment service platforms in 2021.
In 2020 PYPL completed its biggest year yet with revenue rising to $21.45 billion, a growth of 21% YoY. Additionally, non-GAAP EPS grew to $3.88 showing an increase of 31% YoY and the stock gained a total 72.7 million new net active accounts (NNAs) for the year.
Following the release of stock's Q2 2021 report, PayPal witnessed a slight pullback within its shares. Nevertheless, this stock did beat expected earnings and is continuing to show solid growth. Revenue reached $6.24 billion for Q1 growing by 19% YoY, net income reached $1.65 billion, earnings adjusted to $1.15 per share and the company added a further 11.4 million net new active accounts reaching a total of 403 million active accounts in total for the year.
PayPal also sits on a healthy balance sheet with free cash flow of $1.1 billion with the stock raising its guidance to aim to generate above $5 billion for full year 2021.
Additionally, PYPL announced its third quarter result from its crypto buy and sell products through its Venmo app which confirmed a rise of 58% to $58 billion for the quarter. Another clear attraction for PayPal stock as the world of cryptocurrencies continues to dominate globally.
Despite PayPal’s valuation being on the highside, the stock currently holds a forward P/E ratio and P/S ratio of 58.01 and 14.35 respectively. And following on from PayPal's recent report, shares for this digital payment stock have slipped from their highs to $276.41, creating an opportune time for investors to jump in on this stock.
7. Square (SQ)
52-week range: $134.00 - $289.23
With a market cap of just over $125 billion this American financial services and digital payment app Square Inc (SQ) has become a firm favourite amongst fintech investors.
Since the beginning, this stock’s Seller ecosystem has proven to be its foundation as it aims to provide it all from loans to point-of-sales to additional tools to help consumers grow their businesses worldwide. In 2021 the company's Seller ecosystem is continuing to be a leader as it reached $1.31 billion for the quarter beating expectations. Looking at the bigger picture, annual gross payment volume (GPV) is set to reach above $130 billion for the year.
But the stock's peer-to-peer digital payment platform Cash App has been a shining real winner over the past year with this segment reaching revenue of $605 million with gross profit rising by 94% YoY. The mobile payment service allows money transfers from one account to another for both personal and business purposes that in March 2021 reached above 36 million active users across the US and the UK, gaining a gross profit per user of $41 off the back of less than $5 it takes to set up a new user.
Another standout point for Cash App is its ability to generate revenue from various avenues through fees and commissions, and one avenue that is proving to be edging to greatness is Cash App’s ability to trade and exchange the largest cryptocurrency on the market, Bitcoin. Within Q2 Bitcoin’s revenue within the app evidently rose to $2.72 billion from $875 million back in Q2 2020.
Moving forward what will further strengthen both of the stocks stand out systems is its new acquisition plans of the Australian company Afterpay, a financial technology company that is booming from its “Buy now pay later” protocols in a deal worth a whopping $29 billion that is set to help edge SQ to profitability over the long term.
SQ stock is currently trading up following the company’s new acquiring plans to $273.08, with analysts giving this stock a median price target of $300 over the coming months. In addition, expected earnings are set to grow at a rate of 31.88% over the coming 3-5 years.