Some investors want to beat the market instead of accumulating shares of an index fund. These investors often prioritize top-rated growth stocks that show compelling financials and tremendous potential.
While it’s possible to find these stocks with your own research and a reliable screener, investors can also take a cue from Wall Street analysts. Not every Wall Street analyst outperforms the market, but their research and commentary around their price targets can empower retail investors. Wall Street has shown favor in the past to many current top-rated growth stocks, including these three standouts.
Alphabet (GOOG, GOOGL)
Wall Street often sticks with its favorites, especially if those picks continue to perform well. Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) fits that description and is present in many mutual funds and ETFs.
Alphabet makes most of its revenue from advertising placements on Google and YouTube. However, the company has diversified into cloud computing and other bets. Those business segments can accelerate revenue growth, but Alphabet’s ad business remains reliable.
The firm recently laid off workers in a move that Wall Street views as an effective cost-cutting measure. The move can increase Alphabet’s profitability and reward investors.
Alphabet’s stock has performed well for many years. Shares are up by 54% over the past year and have gained 165% over the past five years. Despite approaching a $2 trillion market cap, Alphabet continues to grow.
The company posted 11% year-over-year revenue growth in the third quarter of 2023. Net income increased by 41.6% year-over-year.
Amazon (AMZN)
Amazon (NASDAQ:AMZN) is a universally beloved stock among Wall Street analysts. 42 analysts rated the e-commerce tech giant as a “buy” with zero hold or sell ratings. The average price target implies close to 20% upside with $220 per share as the highest price target.
Amazon continues to grow despite being a large company valued at $1.6 trillion. The company reported 13% year-over-year sales growth in the third quarter of 2023. Net income reached $9.9 billion which was a big improvement from the $2.2 billion net income during the same period last year.
Amazon has experienced a resurgence with a 63% gain over the past year. The stock currently trades at a 40-forward P/E ratio. Growth in advertising and cloud computing can lead the stock to further gains.
Just like Alphabet, Amazon has been laying off workers in multiple divisions. Wall Street interprets this development as an opportunity for Amazon to increase profits and put more capital into high-growth areas.
Celsius Holdings (CELH)
Celsius Holdings (NASDAQ:CELH) is a sports beverage brand that more than doubled its revenue and earnings in 2023. The company has been achieving that high growth rate for quite some time, resulting in a 4,775% stock gain over the past five years.
Despite the stock’s success, the firm only has a $14 billion market cap. The company has more opportunities to explore, including international markets. Celsius Holdings is in its very early innings with international expansion. The overwhelming majority of its revenue comes from North America.
The sports drink is a healthier alternative to other beverages in the market. Celsius Holdings isn’t the first brand to take off because it offers a healthier alternative to a common food or drink. For instance, Chipotle (NYSE:CMG) has rewarded investors for several years because it’s a healthier alternative to other fast food joints.
Investors see the trend taking shape again and project CELH to gain more than 20% from its current price. 12 out of 14 analysts rated the stock as a “buy” while the remaining two analysts rated it as a “hold.”
On this date of publication, Marc Guberti held a long position in CELH. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
