Retail sales have surpassed analysts’ expectations of a 0.1% increase this month, with a robust 0.6% growth instead. This growth rate surge is largely attributed to rising gasoline prices. Similarly, the Producer Price Index (PPI) brought encouraging news, with an overall index rise of 0.7% for the month, surpassing the consensus forecast of 0.4%. Yet, this increase is primarily driven by the recent increases in gasoline prices, and in the long term, this boost in retail sales can benefit the economy by stimulating increased consumer spending, leading to positive growth effects across various sectors.
Additionally, the higher PPI figures indicate a potential for increased profitability in the stock market, which can drive job creation and investments to further contribute to long-term economic growth and stability.
These three Nasdaq stocks are the ones to buy in on long-term growth based on their profitability and product offerings for improved financials.
Palo Alto Networks Incorporated (PANW)
Palo Alto Networks Incorporated (NASDAQ:PANW) is a global leader in the cyber security industry. PANW stock is up 73.49% year-to-date (YTD). Furthermore, the cyber security market is worth $173.50 billion globally in 2022 and is projected to grow to a value of $266.20 billion by 2027 at an 8.9% CAGR.
Palo Alto Networks reported a PYQ4 revenue of $1.95 billion that grew 25.98% YoY. This gain in revenue can be accredited to the growth that the company saw through its service subscriptions. The company further demonstrated an FCF yield of 46.84% from 2021 to 2022, and a strong earnings per share (EPS) at $1.25.
At the end of July of this year, Palo Alto Networks introduced its continuous integration and continuous delivery (CI/CD) security program, becoming the first Cloud-Native Application Protection Platform (CNAPP) to provide security for software delivery. The implementation of this service will serve to the fact that the delivery pipeline when uploading and downloading will ultimately be more secure than ever. Without this protection, software being uploaded has been susceptible to possible open-source vulnerabilities and hack attacks.
Moreover, in December of 2022, PANW completed its acquistion of Cider Security. Cider Security was an innovator in software supply chain security and application security. The acquisition will assist Palo Alto Networks in strengthening various branches of its software security services, including Software Composition Analysis (SCA) and Secret Scanning. This strategic move expands the company’s service offerings, providing a more comprehensive suite of security solutions that can attract new clients and bolster relationships with existing ones. It also strengthens Palo Alto Networks’ competitive advantage in the dynamic cybersecurity market, positioning it as a leading player.
Lastly, Yahoo! Finance reports 41 analysts, 29 of whom rated PANW stock with a 1-year mean price target of $274.77, ranging from $190.00 to $340.00. PAWN is a stock that investors should as its acquisitions provide leeway for strong and sustained growth.
Align Technology (ALGN)
Align Technology (NASDAQ:ALGN) is a medical device company most well-known for its Invisalign brand. ALGN stock is up 56.44% YTD, and is steadily growing in the long term.
Align reported solid financials. Revenue of $1 billion beat expectations by $9.2 million and grew 3.36% YoY, EPS of $2.22 beat expectations by $0.18, and net income of $111.81 million fell 0.87% YoY. This was mainly due to revenue increases of products across the board.
Align recently announced its definitive agreement to acquire privately held Cubicure GmbH. Cubicure is a pioneer in direct 3D printing solutions for polymer additive manufacturing. The addition of the Cubicure team will allow Align to further extend its global leadership in digital orthodontics and 3D printing. This is all part of Align’s long-term strategy which consists of investment in technologies that enable the next generation of direct 3D printed products, and create more sustainable and efficient solutions.
Another statement was recently issued to address the impact of the Cubicure acquisition on Align’s partnership with 3D Systems. 3D Systems remains a critical partner for Align and will continue to provide hardware, materials, processing, and services in connection with its highly efficient indirect production of aligners. This complements Cubicure’s R&D efforts on direct 3D printing of aligners and will suit consumers’ needs indefinitely.
Yahoo! Finance reports 12 analysts with a mean 1-year price target of $332.09, ranging from a low of $270.00 to a high of $450.00. All 11 analysts have rated ALGN as a buy or strong buy rating, and notable firms have also predicted strong upsides.
Align has shown itself to be forward-looking with its 3D printing expansion, and its stand-out product line has poised the company for growth in the future. ALGN stock is poised for long-term growth, and investors should purchase in.
Hawkins Incorporated (HWKN)
Hawkins Incorporated (NASDAQ:HWKN) is a manufacturer and distributor of industrial and reagent-grade chemicals for water treatment, manufacturing, and other industrial purposes. Moreover, it actively invests in the community and seeks to keep the environment clean.
Currently valued at $60.38, HWKN stock is up 57.94% YTD and has an annual dividend yield of 1.04%. 1 analyst has recently upgraded HWKN stock from neutral to buy with a one-year price target of $62.00. In the last year, HWKN stock has performed better than a number of other stocks in its sector, such as Quaker Chemical Corporation up 2.98% YTD and Celanese Corporation up 26.14%.
Hawkins’ 2023 Q3 report showed a revenue of $251.12 million growing by 1.86% YoY with a net income of $23.43 million which grew 18.96% YoY and a diluted EPS of $1.12 that increased by 19.15% YoY. These financials are all strong indicators of profitability and stability in the long term for Hawkins.
According to BusinessWire, the global chemical distribution market was valued at $266.67 billion in 2021. Moreover, the market value is projected to grow at a CAGR of 5% to $374.52 billion by 2027. Industries such as manufacturing, water treatment, health, and nutrition, depend on chemicals to function which gives this market potential for steady growth.
Hawkins currently operates 40 water treatment facilities, and it has strategically acquired five additional facilities since July 2020. This highlights Hawkins’ consistent commitment to expanding its portfolio through accretive acquisitions. Looking ahead, the company has ambitious plans to continue its growth trajectory by acquiring one to two more facilities each year. Moreover, Hawkins’ ability to maintain robust supplier relationships and long-term customer partnerships plays a pivotal role in ensuring a steady and dependable income stream. This long-term stability in revenue generation not only safeguards the company’s financial health, but also positions it for sustained growth in the years to come.
HWKN stock is one of the best undervalued stocks to buy because of its stability and growth potential. By capitalizing on its strong acquisition strategy and solid customer and supplier connections, Hawkins is well-positioned for long-term growth and success in the water treatment industry.
On the date of publication, Michael Que did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
The researchers contributing to this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.