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Buy 5 Growth Stocks to Boost Your Portfolio in Q4 After a Mixed Q3
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Key Takeaways
Quanta Services' backlog hit $53.4 billion, driven by AI, grid modernization and infrastructure spending.
FormFactor's HBM growth and advanced packaging demand are fueling semiconductor test opportunities.
Semtech's data center sales surged, with 1.6T FiberEdge and CopperEdge broadening its growth opportunity.
Third-quarter 2026 was mixed for U.S. stocks. The S&P 500 and the Nasdaq Composite rose 2% and 2.5%, respectively, while, the Dow fell 2.7%. Wall Street witnessed strong July and August partially offset by a volatile September.
However, the fourth-quarter of 2026 is likely to remain strong supported by a softer-than-expected inflation, reductions in U.S. government bond yields and crude oil prices. The Fed, too, may not be as aggressive with respect to interest rate hikes as expected.
At this stage, we have identified five growth stocks that investors should purchase to strengthen their portfolios in September. Growth investors are primarily focused on stocks with aggressive earnings or revenue growth, which should propel prices higher in the future.
The chart below shows the price performance of our five picks in the past three months.
Image Source: Zacks Investment Research
Quanta Services Inc.
Quanta Services is well-positioned to capitalize on robust infrastructure spending across utility, power generation, technology and load center markets. The ongoing expansion of AI data centers, grid modernization, renewable generation and advanced manufacturing is driving customers to undertake larger, multi-year infrastructure programs.
Surging AI-related power demand and expanding utility investments are driving data center project opportunities, making data centers a central pillar of PWR’s long-term growth strategy. The company is heavily investing in deepening its vertical supply chain to offset the ongoing global uncertainties and rising inflation.
These favorable trends helped drive total backlog to a record $53.4 billion as of June 30, 2026, up 49% year over year from $35.8 billion in June 2025. The increase was broad-based, with Electric Infrastructure Solutions backlog rising year over year to $43.8 billion from $30.3 billion, while Underground and Infrastructure Solutions backlog climbed to $9.7 billion from $5.6 billion.
Solid Estimate Revisions
Quanta has an expected revenue and earnings growth rate of 38.4% and 55.4%, respectively, for the current year. The Zacks Consensus Estimate for the current year’s earnings has improved 0.2% over the last seven days.
FormFactor Inc.
FormFactor is benefiting from robust growth in HBM driven by the rapid adoption of generative AI and high-performance computing. FORM’s strong market position in DRAM, particularly with HBM, is driven by robust demand and the ramp-up of new chip designs like HBM4, expected to further fuel growth in 2026 and beyond.
FormFactor benefits as advanced packaging and high-performance compute increase the number and complexity of semiconductor test insertions. Advanced packaging continues to increase test complexity in DRAM, especially as HBM moves to higher speeds. In second-quarter 2026, DRAM revenues reached a record $85 million, with HBM contributing about two-thirds of the total. Management expects third-quarter 2026 DRAM revenues to remain comparable sequentially despite a mix shift toward DDR.
FORM’s Foundry and logic revenues increased to $121.8 million in the second quarter from $111.2 million in the first quarter, led primarily by data-center CPU demand on top of networking, custom ASIC, PC and mobile activity. Management expects continued growth in Q3 across its served applications.
Co-packaged optics is moving from development toward higher-volume production and is supporting Systems growth. The opportunity is tied to growing CPO chip volumes and FORM’s position at the first wafer-level test insertion for photonic integrated circuits.
Solid Estimate Revisions
FormFactor has an expected revenue and earnings growth rate of 31.2% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 3.1% over the last 60 days.
Semtech Corp.
Semtech is benefiting from rising AI data center networking demand as 800G remains active and 1.6T FiberEdge and CopperEdge ramps broaden its content opportunity. LoRa is extending across industrial, smart-home and mass-market consumer applications, while premium-device protection and sensing add another growth avenue.
Portfolio optimization and photonics expansion should support a higher-margin mix, and cash generation is funding capacity and product investment. SMTC’s data center business is scaling as 800G demand is complemented by 1.6T FiberEdge and CopperEdge ramps.
In second-quarter fiscal 2027, data center net sales reached a record $100 million, up 39% sequentially and 91% year over year. FiberEdge TIA and driver solutions are designed into every major module provider in the company’s target markets, with some sole-source positions.
SMTC expects 1.6T FiberEdge market share to exceed 50% by fiscal 2027-end, while CopperEdge is already capturing the majority of the linear equalizer market. For third-quarter fiscal 2027, management projects data center sales growth of 45% sequentially and 160% year over year, with momentum expected to continue through fiscal 2028.
Solid Estimate Revisions
Semtech has an expected revenue and earnings growth rate of 41.5% and more than 100%, respectively, for the current year (ending January 2027). The Zacks Consensus Estimate for the current year’s earnings has improved 30.8% in the last 60 days.
Centene Corp.
Centene has established itself as a national leader in healthcare services. It is a well-diversified healthcare company that primarily provides a set of services to government-sponsored healthcare programs, while serving underinsured and uninsured individuals through member-focused services.
CNC continues to benefit from disciplined pricing, portfolio optimization, favorable Medicaid rate actions, and strong Medicare Prescription Drug Plan momentum. Strategic acquisitions, partnerships, and ongoing enterprise optimization initiatives are strengthening care delivery, improving operational efficiency, and supporting long-term margin restoration.
Solid Estimate Revisions
Centene has an expected revenue and earnings growth rate of 0.8% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for the current year’s earnings has improved 7% over the last 60 days.
Roku Inc.
Roku continues to benefit from the shift of viewing and advertising budgets from linear television to streaming, with Platform revenue growth supported by Advertising and Subscriptions. ROKU’s scale of more than 100 million streaming households, broader programmatic reach and expanding subscription offering support continued monetization of the Roku Experience.
The new Home Screen and AI-powered search could further improve content discovery, retention and advertising opportunities as the rollout expands. ROKU is broadening its advertising model across programmatic demand, enterprise campaigns and self-service tools. Advertising revenues increased 24.8% year over year in the second quarter of 2026 to $672.8 million, while advertising gross margin rose to 62.4%.
Solid Estimate Revisions
ROKU has an expected revenue and earnings growth rate of 18.5% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for the current year’s earnings has improved 2.2% over the last 30 days.
View the Zacks #1 Rank List
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Buy 5 Growth Stocks to Boost Your Portfolio in Q4 After a Mixed Q3
Key Takeaways
Third-quarter 2026 was mixed for U.S. stocks. The S&P 500 and the Nasdaq Composite rose 2% and 2.5%, respectively, while, the Dow fell 2.7%. Wall Street witnessed strong July and August partially offset by a volatile September.
However, the fourth-quarter of 2026 is likely to remain strong supported by a softer-than-expected inflation, reductions in U.S. government bond yields and crude oil prices. The Fed, too, may not be as aggressive with respect to interest rate hikes as expected.
At this stage, we have identified five growth stocks that investors should purchase to strengthen their portfolios in September. Growth investors are primarily focused on stocks with aggressive earnings or revenue growth, which should propel prices higher in the future.
The stocks are: Quanta Services Inc. (PWR - Free Report) , FormFactor Inc. (FORM - Free Report) , Semtech Corp. (SMTC - Free Report) , Centene Corp. (CNC - Free Report) and Roku Inc. (ROKU - Free Report) . Each of our picks sports a Zacks Rank #1 (Strong Buy) and has a Growth Score of A. You can see the complete list of today’s Zacks #1 Rank stocks here.
The chart below shows the price performance of our five picks in the past three months.
Image Source: Zacks Investment Research
Quanta Services Inc.
Quanta Services is well-positioned to capitalize on robust infrastructure spending across utility, power generation, technology and load center markets. The ongoing expansion of AI data centers, grid modernization, renewable generation and advanced manufacturing is driving customers to undertake larger, multi-year infrastructure programs.
Surging AI-related power demand and expanding utility investments are driving data center project opportunities, making data centers a central pillar of PWR’s long-term growth strategy. The company is heavily investing in deepening its vertical supply chain to offset the ongoing global uncertainties and rising inflation.
These favorable trends helped drive total backlog to a record $53.4 billion as of June 30, 2026, up 49% year over year from $35.8 billion in June 2025. The increase was broad-based, with Electric Infrastructure Solutions backlog rising year over year to $43.8 billion from $30.3 billion, while Underground and Infrastructure Solutions backlog climbed to $9.7 billion from $5.6 billion.
Solid Estimate Revisions
Quanta has an expected revenue and earnings growth rate of 38.4% and 55.4%, respectively, for the current year. The Zacks Consensus Estimate for the current year’s earnings has improved 0.2% over the last seven days.
FormFactor Inc.
FormFactor is benefiting from robust growth in HBM driven by the rapid adoption of generative AI and high-performance computing. FORM’s strong market position in DRAM, particularly with HBM, is driven by robust demand and the ramp-up of new chip designs like HBM4, expected to further fuel growth in 2026 and beyond.
FormFactor benefits as advanced packaging and high-performance compute increase the number and complexity of semiconductor test insertions. Advanced packaging continues to increase test complexity in DRAM, especially as HBM moves to higher speeds. In second-quarter 2026, DRAM revenues reached a record $85 million, with HBM contributing about two-thirds of the total. Management expects third-quarter 2026 DRAM revenues to remain comparable sequentially despite a mix shift toward DDR.
FORM’s Foundry and logic revenues increased to $121.8 million in the second quarter from $111.2 million in the first quarter, led primarily by data-center CPU demand on top of networking, custom ASIC, PC and mobile activity. Management expects continued growth in Q3 across its served applications.
Co-packaged optics is moving from development toward higher-volume production and is supporting Systems growth. The opportunity is tied to growing CPO chip volumes and FORM’s position at the first wafer-level test insertion for photonic integrated circuits.
Solid Estimate Revisions
FormFactor has an expected revenue and earnings growth rate of 31.2% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 3.1% over the last 60 days.
Semtech Corp.
Semtech is benefiting from rising AI data center networking demand as 800G remains active and 1.6T FiberEdge and CopperEdge ramps broaden its content opportunity. LoRa is extending across industrial, smart-home and mass-market consumer applications, while premium-device protection and sensing add another growth avenue.
Portfolio optimization and photonics expansion should support a higher-margin mix, and cash generation is funding capacity and product investment. SMTC’s data center business is scaling as 800G demand is complemented by 1.6T FiberEdge and CopperEdge ramps.
In second-quarter fiscal 2027, data center net sales reached a record $100 million, up 39% sequentially and 91% year over year. FiberEdge TIA and driver solutions are designed into every major module provider in the company’s target markets, with some sole-source positions.
SMTC expects 1.6T FiberEdge market share to exceed 50% by fiscal 2027-end, while CopperEdge is already capturing the majority of the linear equalizer market. For third-quarter fiscal 2027, management projects data center sales growth of 45% sequentially and 160% year over year, with momentum expected to continue through fiscal 2028.
Solid Estimate Revisions
Semtech has an expected revenue and earnings growth rate of 41.5% and more than 100%, respectively, for the current year (ending January 2027). The Zacks Consensus Estimate for the current year’s earnings has improved 30.8% in the last 60 days.
Centene Corp.
Centene has established itself as a national leader in healthcare services. It is a well-diversified healthcare company that primarily provides a set of services to government-sponsored healthcare programs, while serving underinsured and uninsured individuals through member-focused services.
CNC continues to benefit from disciplined pricing, portfolio optimization, favorable Medicaid rate actions, and strong Medicare Prescription Drug Plan momentum. Strategic acquisitions, partnerships, and ongoing enterprise optimization initiatives are strengthening care delivery, improving operational efficiency, and supporting long-term margin restoration.
Solid Estimate Revisions
Centene has an expected revenue and earnings growth rate of 0.8% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for the current year’s earnings has improved 7% over the last 60 days.
Roku Inc.
Roku continues to benefit from the shift of viewing and advertising budgets from linear television to streaming, with Platform revenue growth supported by Advertising and Subscriptions. ROKU’s scale of more than 100 million streaming households, broader programmatic reach and expanding subscription offering support continued monetization of the Roku Experience.
The new Home Screen and AI-powered search could further improve content discovery, retention and advertising opportunities as the rollout expands. ROKU is broadening its advertising model across programmatic demand, enterprise campaigns and self-service tools. Advertising revenues increased 24.8% year over year in the second quarter of 2026 to $672.8 million, while advertising gross margin rose to 62.4%.
Solid Estimate Revisions
ROKU has an expected revenue and earnings growth rate of 18.5% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for the current year’s earnings has improved 2.2% over the last 30 days.