In a recent FOMC meeting, Fed Chair Jerome Powell announced that interest rate hikes would remain paused, signaling a bullish outlook for the stock market. This news has presented an opportunity for investors to buy stocks that have been sold down to depressed levels. In this article, we will cover three top-ranked stocks with compelling business models and strong sales growth.
Trupanion: A Leading Pet Insurance Company
Trupanion (TRUP) is a pet insurance company that provides coverage for veterinary expenses. With customizable insurance plans for cats and dogs, Trupanion helps pet owners manage unexpected medical costs. The company offers a comprehensive plan with no payout limits and a simplified claims process. The pet insurance industry is experiencing rapid growth, creating a favorable environment for Trupanion.
Despite a decline in stock price this year, Trupanion has formed a double bottom pattern and is trading at its lowest relative valuation. With a market share of 30% and strong unit economics, Trupanion is well-positioned in the pet insurance market.
Datadog: A Cloud-based Monitoring and Analytics Platform
Datadog (DDOG) is a leading cloud-based monitoring and analytics platform that provides comprehensive observability solutions for applications, infrastructure, and cloud environments. The company’s strong sales and earnings growth projections make it an attractive investment option. With sales expected to climb 23% this year and earnings projected to grow by 35%, Datadog is positioned for success.
Although Datadog is trading near its lowest valuation, its forward sales multiple is above the industry average. However, with projected EPS growth of 22% annually over the next 3-5 years, investors are willing to pay a premium for the stock.
Deckers Outdoor: A Diverse Footwear and Apparel Company
Deckers Outdoor (DECK) is an American footwear and apparel company known for its diverse portfolio of brands, including UGG, Teva, Hoka One, and Sanuk. Despite the challenges in the apparel industry, Deckers Outdoor has delivered strong returns over the past decade, outperforming the market and its peers.
The company’s earnings have steadily grown, and analysts have upgraded their earnings estimates for Deckers Outdoor. With a positive earnings trend and a forward sales multiple below its four-year median, Deckers Outdoor presents a compelling investment opportunity.
Bottom Line
The Zacks Rank is a valuable tool for identifying stocks with bullish potential based on analysts’ earnings estimate revisions. Trupanion, Datadog, and Deckers Outdoor are three top-ranked stocks that offer compelling investment opportunities. With their strong business models, sales growth, and positive outlook, these stocks deserve the attention of investors looking for profitable opportunities in the market.
Disclosure: This article reflects the author’s opinion and does not necessarily reflect the views of Nasdaq, Inc.
Sources:
- Image Source: Zacks Investment Research
- Image Source: PetKeen
- Image Source: TradingView
Keywords: Bull market, top ranked stocks, investors, Trupanion, pet insurance, Datadog, cloud-based monitoring, Deckers Outdoor, footwear, apparel
