The tech market is surging, with a remarkable 40% year-to-date increase in the Nasdaq-100 Technology Sector. The buzz around high-growth stocks in fields including AI and cloud computing is palpable. These advancements fuel Wall Street’s bullish stance, and the enthusiasm is set to continue into the next year. With the New Year fast approaching, savvy investors are eyeing key opportunities for substantial returns, yet there’s a compelling case for looking beyond the shimmer of tech.
While enticing, the tech sector’s current boom hints at possible overvaluation and market saturation. With that said, it’s prudent to broaden our horizons and delve into other sectors ripe with high-growth potential. Diversifying into industries like healthcare, renewable energy, and consumer goods isn’t just a safety play; it’s a strategic move to tap into burgeoning markets driven by innovation and evolving customer needs. Often overshadowed by tech’s allure, these sectors present growth stocks with more grounded valuations and promising long-term prospects. By embracing this diversified approach, investors can weave a portfolio that balances potential, stability, and reasonable valuations. Let’s look at some of the high-growth stocks:
High-Growth Stocks: Deere & Company (DE)
Deere & Company (NYSE:DE) is a noteworthy yet often overlooked blue-chip stock, showcasing remarkable resilience and growth. Over the past five years, the company has demonstrated solid revenue and EBITDA expansion at 12.5% and 23.2%, respectively. In the fiscal year 2023, Deere’s revenue surged by an impressive 16.5% year-over-year to a whopping $61.25 billion, while net income soared to $10.17 billion, equating to $35 per share. This result comfortably exceeded expectations, considering they had already raised their revenue and EPS estimates twice this year.
Despite facing supply chain challenges that rattled the infrastructure equipment market, the company maintained its robustness. Now, with the anticipation of interest rate cuts in 2024, Deere is positioned for even greater success ahead. The consistent upward trajectory in net income and revenue highlights the company’s unwavering commitment to excellence and growth.
McDonald’s (MCD)
McDonald’s (NYSE:MCD), a symbol of consistency in the fast food industry, operates a global network of around 40,000 restaurants. While its steady performance is often misconstrued as sluggishness in terms of growth, recent figures tell a different story, challenging this perception. In the latest quarter, McDonald’s demonstrated incredible growth, with comparable sales surging by 14% to $6.7 billion. This increase is particularly notable, considering the overall sales growth was 11% in the same period. This uptick in top-line growth underscores the company’s dynamic business model, contrary to its “slow-growing” status.
Furthermore, McDonald’s has set an ambitious goal to increase its restaurant count from 40,000 to 50,000 by 2027. This expansion plan reflects a clear growth trajectory combined with the recent impressive earnings report, which paints McDonald’s not as a sluggish giant but as a rapidly evolving fast-food sector leader.
High-Growth Stocks: NextEra Energy (NEE)
NextEra Energy (NYSE:NEE) is a stellar addition to any investment portfolio, backed by its impressive performance and strategic growth plans. The firm witnessed laudable earnings per EPS growth in the first three quarters and is on track to meet its current year projections. Although there have been concerns about high-interest environments and funding issues, these mainly pertain to its affiliate, NextEra Energy Partners, which is focused solely on renewable energy. Also, the company uniquely combines the stability of a regulated utility with the innovation of a renewable energy enterprise.
As the nation’s largest electric utility, NextEra Energy consistently generates reliable sales. Simultaneously, it’s making significant strides in renewable energy, particularly in the solar and wind sectors. Moreover, the firm targets an earnings growth rate of 6% to 8% through 2026, highlighting its balanced and forward-looking business model. NextEra Energy is also known for its strong track record of shareholder value, offering regular dividends. It pays an above-average quarterly dividend of $1.87, translating to a 3.07 % yield.
Cintas (CTAS)
Based in Mason, Ohio, Cintas (NASDAQ:CTAS) has established itself as a critical player in the corporate service industry, offering various products and services, including uniforms, mats, cleaning supplies, and crucial safety equipment. Its role as a crucial component of the wider infrastructure has not gone unnoticed by investors. Moreover, this recognition is further echoed by Goldman Sachs, which recently included Cintas in its November “U.S. conviction list,” a selection of 25 stocks the firm views as top buy ideas based on their standout fundamental qualities.
Furthermore, the firm’s consistent performance is superb, having surpassed estimates for 18 consecutive quarters, a streak it maintained in its first quarter. Additionally, Cintas’ strategic technology adoption has significantly boosted its operational efficiencies, distinguishing it from competitors. This is evident in its latest earnings report, with a first-quarter GAAP EPS of $3.70, beating expectations by two cents, and a revenue increase of 8.1% year-over-year, reaching $2.34 billion. These robust financials and its technological edge position Cintas as a compelling investment choice in the corporate services sector. Thus, it is one of my top picks regarding high-growth stocks.
High-Growth Stocks: Eli Lilly (LLY)
Eli Lilly (NYSE:LLY) is poised for rapid expansion, especially with its diabetes and obesity treatments resulting in surging demand. Throughout 2023, the spotlight has been on Mounjaro, Eli Lilly’s innovative diabetes treatment, which demonstrated an ability to reduce weight in obese patients, attracting immense interest.
Despite the lack of FDA approval, Mounjaro’s, its weight reduction capabilities didn’t go unnoticed. However, Eli Lilly was restricted from marketing the drug for weight reduction until a significant development in early November. The company finally received FDA approval to market the drug for this specific use, now branded as Zepbound.
This approval marks a turning point, with analysts projecting that Zepbound and Mounjaro’s combined sales could skyrocket to an astonishing $100 billion annually. Given the escalating obesity crisis in America, this development is expected to catapult LLY stock to new heights, reinforcing the company’s position as a top-tier player in addressing these critical health issues.
Carnival Corporation (CCL)
According to its latest quarterly earnings report, Carnival Corporation (NYSE:CCL) is making impressive strides in the fiscal realm. The cruise industry behemoth posted a remarkable sales figure of $6.85 billion, marking a massive 59.21% increase year-over-year and exceeding expectations by $161.4 million. This financial achievement is further highlighted by its strong EPS of 86 cents, outperforming the analyst consensus by 13 cents. This performance reflects investor confidence and indicates a path toward recovery for CCL.
However, like many in its sector, Carnival faces its share of economic headwinds, including high fuel costs and inflationary pressures, impacting financial margins. Despite these challenges, the company’s stock has seen a notable increase of over 132% year-to-date, attracting investors who are eyeing the long-term growth possibilities. Moreover, the firm has successfully reduced its long-term debt, which remains substantial at $31 billion, by over $4 billion from its peak. That’s why I think it is one of the best high-growth stocks to buy.
Delta Air Lines (DAL)
Delta Air Lines (NYSE:DAL) is coming off a stellar quarter, propelled by a business and leisure travel surge. The company witnessed a 6% bump in domestic sales, while international sales leaped by 35% compared to last year, mainly driven by a high demand for transatlantic journeys. Additionally, its profits jumped an incredible 60% after a mighty summer. This trend looks set to continue, with Delta expecting packed planes during the holiday season. Moreover, robust demand for travel on Delta has continued into the December quarter according to Delta’s management.
Delta’s success story extends beyond revenue figures. The airline is actively deleveraging its balance sheet, repaying more than $3.7 billion in debt year-to-date. Furthermore, its solid fundamentals and the positive outlook for international travel are major reasons for analysts’ bullish stance on Delta, offering more than a 34% upside from current price levels. With crude oil prices stabilizing, thus easing fuel cost pressures, and the growing demand for international travel, Delta Airlines stands out as a top-rated stock in the aviation sphere.
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.