With the holidays around the corner, now is a great time to search for the best growth stocks to buy. The new bull market has been set and investors cannot overlook the opportunities that are present. Instead of splurging your holiday bonus on unnecessary luxuries, you can instead deploy that money into your stock portfolio.
There are a number of companies that have skyrocketed in 2023, while others have largely flown under the radar. If 2022 was the first bear market you experienced you might be reluctant to put your money to work. But the truth is cash is only valuable in the present, and overtime you’re better off investing it to outpace inflation. As the year end approaches, these growth stocks can add an extra dose of holiday cheer!
Below are my top three strong buy stocks for the holidays!
Oracle (ORCL)
Oracle (NYSE:ORCL) should be on your buy list with the holidays closing in. An American multinational technology company headquartered in Austin, Texas, Oracle primarily operates in the enterprise cloud sector. The company has grown to be the third largest software company in the world, by revenue.
Oracle is making a serious push in its efforts to ramp up investments towards generative AI. In the Q1 2024 financial results, co-founder Larry Ellison said that ‘’generative AI might be the most important computer technology ever.’’ This is certainly not just hearsay, as AI companies’ purchases in Oracle’s Gen2 Cloud nearly doubled quarter over quarter. In Q1 2024 revenue was $12.5 billion, an increase of 9% YOY. That is small compared to the 18% YOY growth the year prior. However, Oracle’s FCF and EPS growth are telling a different story.
Cloud revenue rose 30% year-over-year to $4.6 billion, and cloud infrastructure revenue is also seeing strong growth, contributing to higher FCF and EPS. Q1 FCF hit $5.7 billion, an increase of 21% YOY. Net income also grew 56% to $2.42 billion, or $0.86 per share. The company is setting its foundation in the AI race and its recurring revenue streams are driving profitable growth. As generative AI re-shapes cloud network infrastructure, Oracle should be at the top of your buy list.
Automatic Data Processing (ADP)
Automatic Data Processing (NASDAQ:ADP) is an American HR software company headquartered in Roseland, New Jersey. There is a strong chance that if you’re in the workforce, that you’ve used its software before. Over the last 5 years, ADP has averaged 14% EPS growth and its dividend has grown favorably alongside it.
When you think of strong growth stocks to buy, Automatic Data Processing is probably not the first to come to mind. However, the company has been around for more than 7 decades and has rewarded its shareholders handsomely. For FY fiscal 2023, revenue grew 8% YOY to $18 billion. Additionally, the company grew EPS 17% YOY or $8.21 per share. Despite operating in a higher interest rate environment, ADP’s adjusted EBITDA margin increased by 130 basis points.
Now looking out to its 2024 fiscal year, ADP has shown continuous improvements. In its latest Q1 fiscal 2024 results, revenue and EPS were both up 7% and 11%, respectively. CEO, Maria Black alluded the growth was driven by ‘’new business bookings, strong client revenue retention and higher client fund interest revenue.’’ Furthermore, ADP has recently marked a 12% increase in its quarterly dividend bringing its annual rate to $5.60 per share. This marked its 49th consecutive year of dividend increases. Therefore, investors should consider this no-brainer dividend growth stock as the year end approaches.
JPMorgan Chase (JPM)
JPMorgan Chase (NYSE:JPM) is a strong buy as it beat profit expectations, according to the Q3 2023 financial results. The company’s net interest income (NII) hit record highs, largely driven by operating in a higher interest rate environment.
During the regional banking crisis, JPMorgan acquired a majority of First Republic Bank’s (OTCMKTS:FRCB) consumer loan assets. In Q3 2023, revenue grew 23% YOY to $39.9 billion. Net income came in at $13.15 billion, or $4.33 per share. But what surprised Wall Street the most was JPMorgan’s net interest income which rose 30% YOY, hitting a record $22.9 billion. Despite the acquisition of certain consumer loan assets from First Republic, net interest income still rose 21% YOY.
During the conference call, CEO, Jamie Dimon warned shareholders about the impacts that geopolitical risks pose to the economy. These risks include tight labor market conditions, high debt levels, the Russia/Ukraine war and the Israel-Hamas tensions threatening long term inflation expectations and economic stability. While the market is pricing in interest rate cuts in 2024, there is a possibility that interest rates might remain higher for longer. This bodes particularly well for bank stocks like JPMorgan. With a P/E of just 9, JPM is one of the best strong buy stocks to place on your holiday list.
On the date of publication, Terel Miles 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.
