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3 High-Growth Stocks That Could Soar

3 High-Growth Stocks That Could Soar

Posted On April 10, 2020 12:32 pm
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In the midst of the fallout from the coronavirus, it’s difficult to envision a time when the outbreak is under control and life has returned to normal. But those days are coming. That said, consumerism may never quite be the same again, as working at home has proven viable for some, while others have come to love the convenience of online shopping. Capitalism finds a way, though, forever creating opportunities for investors.

A trio of companies that were doing quite well before the COVID-19 disruption took hold are still positioned to dish out serious growth once the outbreak starts to lessen. In fact, one of them may even fare better than expected specifically because of the coronavirus.

58.com (WUBA)

If you’ve never heard of 58.com (NYSE:WUBA), don’t sweat. Hardly anyone reading this is likely to have stumbled across it, either. That’s because it’s a Chinese company primarily serving the Chinese market, most akin to North America’s online classified listings platform Craigslist.

58.com has conceded that the coronavirus outbreak in China has hurt its business. But, like so many other businesses, it will be able to regroup and restart, most likely picking up where it left off. That’s a good thing, too: Last year’s sales were up nearly 19%, mirrored by similar growth in net income. It’s not jaw-dropping growth, but for an organization that’s been in business since 2005, that’s a respectable pace.

A recent twist has made things even more compelling. 58.com reported last week that it has received an acquisition offer for the entire company. The board didn’t say it intended to take the offer, or even entertain it. But the interest alone speaks volumes about the plausible future of the company. It could also start a bidding war among prospective buyers, or at least prompt a better counteroffer, both of which stand to boost the price of shares in the meantime.

Exact Sciences (EXAS)

Exact Sciences (NASDAQ:EXAS) is best known for its work in cancer detection and diagnostics. Its claim to fame is its Cologuard colorectal cancer test, which can be performed in the privacy of one’s own home.

Cologuard was approved by the U.S. Food and Drug Administration (FDA) in 2014 as the first and only DIY stool/DNA screener, and the product is still driving tremendous sales and earnings growth. Fourth-quarter revenue improved 60% year over year to $296 million, with Cologuard accounting for the vast majority of that top line and its expansion. Analysts are looking for a similar growth pace going forward, which will shrink in percentage terms as the mathematical comparisons swell. They’re not looking for absolute growth to slow anytime soon, however.

Where Exact Sciences is really making major progress, though, is on the bottom line. Increasing demand for Cologuard has finally created enough scale to support margin expansion well in excess of the pace of sales growth. It probably won’t be enough to push the company into the black this year or next, but the trajectory has analysts modeling a big swing to profitability in 2022.

And, importantly… Continue reading at The Motley Fool

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