In a market flirting with historic highs on several indexes, bargains have become harder to find. Therefore, finding stocks that could double your money in a few years also seems more difficult as the likelihood of a market downturn increases.
Nonetheless, even in the event of a stock market crash, some growth stocks can thrive, and investors who want to double their money regardless of market conditions should consider Etsy (NASDAQ: ETSY) and Red tuna (NASDAQ: RDFN).
Let’s find out a bit more about these two hot stocks.
Capitalizing on the growing trend of e-commerce has boosted many stocks. However, continuing its mission of “keeping commerce human”, Etsy offers a unique twist. More than just acting as a sales platform like Shopify, Etsy serves as a community for sellers of craft supplies, crafts, and vintage items.
For one thing, it only allows retailers on the site that sell crafts, vintage items, and related items. Plus, he’s built a specialized search tool designed to connect buyers with sellers who sell what they want. Combined with its low start-up costs, it has fostered a significant competitive advantage in its artisanal niche.
Plus, her land grabbing strategy continues as she just bought what many have called “Brazil’s Etsy,” Elo7. Since Elo7 also specializes in vintage and handcrafted products, it should fit right in with Etsy, giving it an opening into the largest market in Latin America.
This has resulted in rapid growth among its buying and selling communities and in its finances. In the first quarter of 2021, it had attracted 4.7 million sellers, up 67% from the previous year quarter. Additionally, Etsy reported 90.7 million buyers, a 90% increase over the same time period.
This generated quarterly revenue of $ 551 million, a 142% increase from 12 months ago. In addition, net income of $ 144 million increased by almost 1,049% during this period. Slower operating expense growth to 113% and $ 7 million in other income primarily from foreign exchange gains also boosted bottom line. For 2020, revenue jumped 111% from 2019 levels, while net profit increased 264% over the same period. Etsy achieved this by keeping operating expense growth at 83%.
As a result, the Etsy share price has risen almost 80% in the past 12 months alone. Additionally, its P / E ratio of 56 is lower than Shopify and Amazon. Etsy’s massive growth and comparatively lower valuation gives the company huge potential to climb much higher.
Redfin may rise in value as it leads the charge of redefining the way Americans buy and sell real estate. He combines technology and a base of real estate agents he employs to deliver client-focused service.
Additionally, instead of the standard 3% commission charged for each side of the trade, Redfin makes its share between 1% and 2%, depending on the level of service. This saves thousands of commissions. The lower cost also allows it to stand out from the most popular real estate site, Zillow, which only hired its own agents last year.
Redfin’s approach also increased its market share, which now stands at 1.14%, compared to just over 0.90% in the first quarter of 2020. Likewise, it has strengthened its finances as revenues have increased. increased 40% from last year’s levels to $ 268 million. It also reduced its losses over the same period from $ 60 million to less than $ 36 million as increases in the cost of revenues and operating costs lagged revenue growth.
In 2020, revenues grew only 14% from 2019 levels as the company grappled with the effects of the pandemic. In 2020, it lost $ 19 million, up from $ 81 million in 2019, as it kept spending growth short of revenue growth. In addition, the 44% increase in traffic in the fourth quarter compared to the fourth quarter of 2020 temporarily boosted revenues, allowing a profit in this quarter.
In addition, these successes have allowed the title to increase by more than 50% over the past year. Additionally, with a price-to-sales (P / S) ratio of just under seven, that multiple is down from February, when it passed 10.
Finally, in the second quarter, the company expects revenue to double from the second quarter of 2020. Given the current growth trend and its relatively low valuation, the share price could easily increase as income increases.
This article represents the opinion of the author, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are motley! Challenging an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.