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Growth stocks jumped back into style in 2023 following a rough showing last year, with many widely outperforming the general market year-to-date.
Growth stocks are known for their volatility, as their performance is typically tied to big expectations in the future. It’s critical to remember that markets are always looking forward.
And for those seeking exposure, three stocks – Palo Alto Networks (PANW - Free Report) , Super Micro Computer (SMCI - Free Report) , and Caterpillar (CAT - Free Report) – could all be considerations. Let’s take a closer look at each.
Palo Alto Networks
Palo Alto Networks shares have benefited nicely from the AI frenzy in 2023, up more than 70%. The company operates Cortex XSIAM, the company’s integrated suite of AI-driven, intelligent products for Security Operations Centers (SOCs). Analysts have taken their earnings expectations higher across the board.
The company’s growth profile is difficult to ignore, with Zacks Consensus Estimates suggesting 20% earnings growth in its current year (FY24) on 19% higher revenues. And peeking ahead to FY25, estimates allude to a further 19% bump in earnings paired with 18% higher sales.
Palo Alto Networks has delivered some big beats as of late, exceeding the Zacks Consensus EPS Estimate by an average of 22% across its last four quarters. Just in its latest release, PANW exceeded earnings expectations by more than 12% and marginally missed revenue expectations.
Caterpillar
Caterpillar shares have been notably strong over the last three months, up more than 25% and crushing the general market. The stock sports the highly-coveted Zacks Rank #1 (Strong Buy), with earnings expectations increasing across all timeframes.
Caterpillar is a Dividend Aristocrat, fully reflecting the company’s shareholder-friendly nature. Currently, CAT shares yield 1.9% paired with a sustainable payout ratio sitting at 26% of the company’s earnings. The company has consistently boosted its payout, sporting an 8% five-year annualized dividend growth rate.
The company boasts big growth expectations, with the $19.82 Zacks Consensus EPS Estimate for its current year suggesting an improvement of more than 40% year-over-year. And in FY24, earnings are forecasted to climb a further 7%.
Super Micro Computer
Super Micro Computer shares have been massive winners in 2023, up an impressive 240%. The stock sports a Zacks Rank #1 (Strong Buy), with the revisions trend particularly noteworthy for its current fiscal year.
The company’s shares aren’t valuation stretched given its forecasted growth, currently trading at a 17.7X forward earnings multiple (F1). Earnings are forecasted to jump 30% in its current year on 37% higher revenues.
Bottom Line
Growth stocks have jumped back into style in 2023, a welcomed development following last year’s rough showing.
And for those with a growth-focused mindset, all three stocks above – Palo Alto Networks (PANW - Free Report) , Super Micro Computer (SMCI - Free Report) , and Caterpillar (CAT - Free Report) – carry big growth expectations.
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These 3 Companies Boast Big Growth Expectations
Growth stocks jumped back into style in 2023 following a rough showing last year, with many widely outperforming the general market year-to-date.
Growth stocks are known for their volatility, as their performance is typically tied to big expectations in the future. It’s critical to remember that markets are always looking forward.
And for those seeking exposure, three stocks – Palo Alto Networks (PANW - Free Report) , Super Micro Computer (SMCI - Free Report) , and Caterpillar (CAT - Free Report) – could all be considerations. Let’s take a closer look at each.
Palo Alto Networks
Palo Alto Networks shares have benefited nicely from the AI frenzy in 2023, up more than 70%. The company operates Cortex XSIAM, the company’s integrated suite of AI-driven, intelligent products for Security Operations Centers (SOCs). Analysts have taken their earnings expectations higher across the board.
The company’s growth profile is difficult to ignore, with Zacks Consensus Estimates suggesting 20% earnings growth in its current year (FY24) on 19% higher revenues. And peeking ahead to FY25, estimates allude to a further 19% bump in earnings paired with 18% higher sales.
Palo Alto Networks has delivered some big beats as of late, exceeding the Zacks Consensus EPS Estimate by an average of 22% across its last four quarters. Just in its latest release, PANW exceeded earnings expectations by more than 12% and marginally missed revenue expectations.
Caterpillar
Caterpillar shares have been notably strong over the last three months, up more than 25% and crushing the general market. The stock sports the highly-coveted Zacks Rank #1 (Strong Buy), with earnings expectations increasing across all timeframes.
Caterpillar is a Dividend Aristocrat, fully reflecting the company’s shareholder-friendly nature. Currently, CAT shares yield 1.9% paired with a sustainable payout ratio sitting at 26% of the company’s earnings. The company has consistently boosted its payout, sporting an 8% five-year annualized dividend growth rate.
The company boasts big growth expectations, with the $19.82 Zacks Consensus EPS Estimate for its current year suggesting an improvement of more than 40% year-over-year. And in FY24, earnings are forecasted to climb a further 7%.
Super Micro Computer
Super Micro Computer shares have been massive winners in 2023, up an impressive 240%. The stock sports a Zacks Rank #1 (Strong Buy), with the revisions trend particularly noteworthy for its current fiscal year.
The company’s shares aren’t valuation stretched given its forecasted growth, currently trading at a 17.7X forward earnings multiple (F1). Earnings are forecasted to jump 30% in its current year on 37% higher revenues.
Bottom Line
Growth stocks have jumped back into style in 2023, a welcomed development following last year’s rough showing.
And for those with a growth-focused mindset, all three stocks above – Palo Alto Networks (PANW - Free Report) , Super Micro Computer (SMCI - Free Report) , and Caterpillar (CAT - Free Report) – carry big growth expectations.