With the stock market heating up again, consider investing in disruptive stocks to buy. Betting on disruptive stocks, especially at the right prices, can prove incredibly rewarding. Moreover, with expectations of a sustained bull run ahead, you’d be remiss to ignore the three disruptive stock bets at current prices.
Disruptive stocks to buy have the potential to revolutionize their respective industries through their innovative prowess. For investors who can see the potential of disruptive stocks, these businesses can effectively become catalysts for change, pushing boundaries and redefining norms. Hence, embracing these trailblazers can yield substantial gains over the long-term for those who play the trend correctly. Without further ado, here are three disruptive stocks to buy, offering a ton of potential upside.
Disruptive Stocks to Buy: SoFi (SOFI)
Fintech player SoFi (NASDAQ:SOFI) has taken quite a hammering at the stock market this year. Year-to-date (YTD) SOFI stock has shed more than 28% of its value while its underlying business continues to impress. Its revenues have grown by double-digit margins in the past eight consecutive quarters, blowing past analyst estimates with aplomb. At the same time, it’s grown its bottom-line margins at a healthy pace, having achieved two straight quarters of GAAP profitability.
Perhaps one of the key elements underpinning SoFi’s bull case is the diversity in its revenue mix. Its Financial Services and Technology Platforms drove the company to another solid top-and-bottom-line beat in the first-quarter (Q1). Its financial services segment generated a record $151 million in sales at a 25% profit margin. Moreover, the tech segment generated $94 million in sales, a 21% bump on a year-over-year (YOY) basis.
Additionally, the firm’s investment and wealth management services, alongside home loan originations, surged by double-digit margins. Hence, with a diversified revenue mix spanning multiple high-growth sectors, SoFi has established itself as more than just a lending business.
Hims & Hers Health (HIMS)
Hims & Hers (NYSE:HIMS) is a disruptive healthcare enterprise that provides accessible, direct-to-consumer telehealth services and personalized wellness products. It’s been a hyper-growth business over the past several quarters, reflected in its stock price, which is up 59% over the past three years.
2023 was another banner year for the company, with sales shooting up to $872 million, a stellar 65% increase from the prior-year period. Additionally, its subscriber numbers jumped 48% year over year to 1.5 million, demonstrating its superb market penetration and the insatiable demand for its health and wellness solutions.
It kept the same energy in Q1 this year, with another comfortable beat across both lines. Most notably, HIMS swung to a net profit of $11.1 million in Q1 from a crippling net loss of $10.1 million in the prior-year period. Moreover, its subscriber base grew 41% YOY to 1.7 million, along with a 20% increase in net orders to $2.5 million. Also, having raised its adjusted EBITDA guidance, it expects revenues to fall from $1.20 billion to $1.23 billion, ahead of the $1.19 billion consensus.
Palantir (PLTR)
Palantir Technologies (NYSE:PLTR) is a Big Data analytics firm that continues to impress with its glowing quarterly reports. It has been growing its customer base at a rapid clip, mainly driven by its leadership position in AI and data analytics. Moreover, it’s been impressively boosting its bottom line in recent quarters, an area where it previously faced criticism.
Its stellar Q1 results reinforced why it’s one of the giants in its niche. It ended the quarter with a robust adjusted operating margin of 36%, marking the sixth consecutive quarter of improvements in that metric. Moreover, it generated $149 million in adjusted free cash flows, representing a 23% margin, and $3.9 billion in cash and short-term securities.
Furthermore, we saw the firm’s customer base growing by a tremendous 42% YOY in Q1, up from the 32% increase in the last quarter. The surge in its customer base is a testament to the effectiveness of its solutions and the stickiness of its ecosystem. Moreover, it is in an excellent position to capitalize on the evolving AI trend, enabling firms and government agencies to deploy and manage AI tools effectively.
However, it runs the risk of bipartisan cuts to federal spending and its relatively high stock price compared to its low profits. Overall, though, it remains an excellent long-term investment opportunity.
On the date of publication, Muslim Farooque 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.
