Most businesses posting rapid expansion right now will not be able to maintain that level of growth over time. On the other hand, there will be standouts — the rare companies with the right makeup and competitive advantages to capitalize on market trends and repeatedly take their businesses to the next level.
Having even a few of these companies working in your favor over the long term can be a life-changing event. To help put readers on to some high-growth stocks that still have big potential, we asked three Motley Fool investors to profile a top growth investment. Read on to see why they identified the following stocks as top stocks for growth-seeking investors.
Top High Tech Stocks To Invest In 2019: Clarke(T)
There’s no denying AT&T Inc. (NYSE:T) has had its struggles. Wireless telecom as well as broadband have become commodities, and cable television is no longer just available through a literal cable.
Its recent effort to acquire Time Warner Inc (NYSE:TWX) has also run into some political pitfalls. When it’s all said and done though, T stock is entrenched in the markets it needs to be entrenched in, and it’s got the size and cash-stash to but what it needs to buy to remain competitive. It’s not going anywhere.
That said, whether its revenue growth is impressive or not, nobody can deny that AT&T is one heck of a reliable dividend payer. It has been paid out every quarter like clockwork since the mid-80’s, and grown the whole time. Newcomers are going to enjoy a 5.6% yield on their investment.
Top High Tech Stocks To Invest In 2019: Axon Enterprise, Inc.(AAXN)
Now, Axon Enterprise had just changed its corporate name to that name the very month that we did this podcast a year ago. It used to be known as TASER. But Axon Enterprise — the same company that sells Tasers and has innovated with the Taser — changed its name to its other key product, which is its police body cams. And that’s such an important trend.
I was talking about that a year ago — how Axon Enterprise’s main profit source [still is today] was the Taser, but as it builds out police body cams [not just here in the U.S., but globally], it’s a lower margin. They don’t make as much money off its product and they’re sort of in development stage, still. They started losing money with that a year ago, and so it was depressing the corporate results.
But, if you really thought about where the world is headed and how this company was leading us there, you recognized beyond the body cams themselves [the Axon body cams]; the company has Evidence.com, which is the website where up in the cloud all of these videos from all these police departments are stored, and that is a subscription service that police departments buy. So, Evidence.com, Axon, and Taser the stock was at $23 when we did this podcast and I picked it a year ago. It’s now up to $43.00. So, it’s been a tremendous year for Axon, ticker symbol AAXN, up 87%.
Now, I should mention that the S&P 500 over the last year is up 14.5%. We’ll round that up to 15% just to give Mr. Market his due, so we’re competing against a +15% with each of these picks. I’m going to foreshadow and let you know, dear listener, that this was the best of the five stocks. Nothing did better than +87%. A tremendous year for Axon and I’m really excited that it’s in the Rule Breakers portfolio. I hope it’s in your portfolio, too. In fact, the name of this sampler, when I pick stocks a little later, is going to be something like Five Stocks That I Own And You Should, Too.
Now, I wish I did own Axon. I don’t own all of my 220 picks, but I sure hope you listened a year ago. I know many of you do own Axon through Rule Breakers and wow, what a great year it’s been, and I really like this stock going forward. When I picked these stocks for April The Giraffe, unbeknownst to me at the time a year ago, I did say these are for the next three-plus years, so we’ll be reviewing this list of stocks each of the next three years. Year one awesome, Axon!
Top High Tech Stocks To Invest In 2019: iRobot Corporation(IRBT)
Of these two companies, iRobot is scheduled to report its earnings first. The maker of the popular Roomba vacuum is scheduled to report its first-quarter results on Tuesday.
In the fourth quarter, iRobot posted record fourth-quarter revenue of $327 million, up an impressive 54% compared to the year-ago period. The growth marked an acceleration compared to full-year revenue growth of 34%. Operating income also increased, rising from $18.7 million in the fourth quarter of 2016 to $23.1 million in Q4 2017.
But there’s more strong growth in front of the company, according to management. iRobot is optimistic about the "tremendous" opportunity ahead. "Global household penetration of robotic vacuum cleaners remains extremely low, in the single digits," said iRobot CEO Colin Angle in the company’s fourth-quarter earnings release. "Strong economic conditions worldwide are fueling overall global growth and positive consumer sentiment."
With management guiding for 2018 revenue to rise about 20% compared to 2017, based on the midpoint of the forecast range, investors should look for first-quarter revenue growth to handily exceed this growth rate. A first-quarter revenue growth rate beyond management’s expected full-year pace would leave more room for revenue growth to decelerate as the year goes on.