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Investing in Growth: 2 Top-Ranked Stocks with Huge Potential

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Strong sales growth is a beacon for investors seeking promising companies. It often indicates a product or service has struck a chord with the market, generating significant customer demand.

By screening for companies experiencing high-flying sales growth, we can identify potential investment stars poised for continued success.

Of course, it is also critical to convert this sales growth to earnings or profit growth.

Here, I will share two stocks, with top Zacks Ranks, powerful sales and earnings growth, and market beating returns.

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Hims & Hers Health

Hims & Hers Health (HIMS - Free Report)  is a telehealth care company in the US catering primarily to millennials and Gen Z. They provide a convenient alternative to traditional doctor visits by offering online consultations with licensed healthcare professionals for a variety of health and wellness concerns, including sexual health, hair loss, skincare, and mental health.

Patients connect with providers through a user-friendly platform from the comfort of their homes. Hims & Hers also complements their consultations by selling personal care products relevant to their areas of focus.

HIMS has really good business model, as it is asset light and enjoys fat margins. The company also has a very secure balance sheet, with gross margins over 80% and very high sales growth.

Additionally, analysts have been raising earnings expectations over the last two months, giving Hims & Hers Health a Zacks Ranks #2 (Buy) rating.

FY24 earnings have been revised higher by 225% and are projected to climb 190% YoY to $0.10 per share. This year will also mark the first time the company is running with net positive earnings, an encouraging sign of business maturity.

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Coinbase Global

Coinbase Global (COIN - Free Report) , often shortened to Coinbase, is a major cryptocurrency exchange platform. They allow users to buy, sell, and trade various digital currencies in a secure and regulated environment. Coinbase goes beyond trading, offering features like secure wallets, cryptocurrency rewards programs, educational resources, and tools for merchants to accept cryptocurrency payments. Coinbase serves both individual investors and institutions.

In the last month, Coinbase Global just announced an exciting new product that may make the company even more essential to the crypto ecosystem.

Coinbase is making a push to simplify cryptocurrency adoption by developing new wallet solutions for developers. Their goal is to bring billions of users onchain, meaning to actively participate in the blockchain network.

The solutions come in two flavors:

  • Smart Wallet: This option, built by Coinbase Wallet, allows developers to integrate a feature where users can create wallets instantly within an app using just a passkey. This eliminates the need for downloading separate apps, installing extensions, or remembering complex seed phrases, all major hurdles for new users. The beauty of the Smart Wallet is that it's portable, allowing users to take their crypto balances with them and use them across many existing applications.
  • Embedded Wallets: Powered by Coinbase's Wallet as a Service (WaaS), these are custom-designed wallets built directly into specific apps. Users can sign up for these wallets using familiar methods like email or social login, avoiding the need to understand the complexities of crypto transactions like gas fees. This creates a seamless onchain experience where users might not even realize they're interacting with blockchain technology.

Coinbase believes these new tools will significantly reduce friction points in the onboarding process, making it easier and faster for people to enter the crypto space. They hope this will ultimately lead to billions more users participating in the blockchain ecosystem.

Anyone who has ventured into the crypto space knows that in general, it isn’t very user-friendly. But this development could change that. I can imagine Coinbase’s product similar to Apple Pay, which has rapidly and easily been integrated into everyday tech.

Coinbase also enjoys strong sales and earnings growth forecasts. Additionally, reflecting upward trending earnings revisions from analysts, Coinbase has a Zacks Rank #1 (Strong Buy) rating.

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Bottom Line

If you are looking for new stocks with powerful growth expectations, leading technological innovations, and advantageous business models, Hims & Hers Health and Coinbase Global are worthy considerations.


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