APP - 3 Stocks to Buy Before They Skyrocket: July Edition
2024-07-14 13:11:44 ET
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A list of the top stocks to buy early can lead to significant investment opportunities. Here, the focus is on three compelling stocks poised for accelerated growth. Each company stands out not only for its recent financial performance but also for strategic initiatives that position them for future success. One of these companies, a leader in mobile gaming technology, has expanded its footprint into broader digital marketing with its platform, driving substantial revenue growth and profitability.
The second one on the list, a key player in maritime shipping, boasts robust liquidity and contract stability, capitalizing on sectoral recovery and fleet modernization efforts. Meanwhile, the last one on the stock has leveraged AI innovations to fuel remarkable revenue increases, particularly in high-speed connectivity solutions crucial for modern data infrastructure. Learning these companies’ financial strengths and strategic pivots is crucial to identifying breakout opportunities. By analyzing their operational efficiencies, market expansions, and technological innovations, one can gauge their potential for sustained growth and market outperformance.
Applovin (APP)
Applovin (NASDAQ: APP ) specializes in mobile gaming and digital marketing technology, expanding into e-commerce. The company had a top-line of $1.06 billion in Q1 2024, marking a 48% increase year-over-year (YoY). Specifically, its software platform revenue grew by 91% to $678 million. This points to solid demand and adoption of their AXON technology. The company achieved an adjusted EBITDA of $549 million with a margin of 52%, which represents a significant improvement. It has doubled from the previous year, showcasing efficient cost management and operational leverage. Applovin generated $388 million in free cash flow during Q1 2024, representing a remarkable 71% flow-through from adjusted EBITDA.
Moreover, AXON technology improved through self-learning capabilities, additional data integration, and engineering enhancements. These advancements have led to increased return on ad spend (ROAS) for advertisers, driving higher investment in their platforms. The Software Platform segment achieved an adjusted EBITDA margin of 73%, which indicates strong profitability and operations within this core growth area. Indeed, Applovin is expanding beyond the gaming sector into web-based marketing and e-commerce.
Overall, top-line and operational growth, with potentially increasing demand and scalability, make the stocks a top pick among top stocks to buy.
Costamare (CMRE)
Costamare (NYSE: CMRE ) is a leader in maritime shipping, focusing on fleet modernization and leasing. The company has secured contracts for 97% and 80% of its containership fleet for 2024 and 2025. This generates contracted revenues of $2.3 billion with a Twenty-Foot Equivalent Unit (TEU) weighted remaining 3.4 years (Q1 2024). Indeed, this high level of contract coverage ensures predictable cash flows and minimizes exposure to shipping market volatility. This fleet renewal strategy improves operational efficiency. Hence, this positions Costamare to capitalize on economies of scale and edge sharply on favorable market conditions in dry bulk shipping.
Further, there are acquisitions of newer and larger vessels, such as Capesize vessels, with an average age of about 12.5 years. This demonstrates a focus on fleet modernization and capacity enhancement. The company’s investment in Neptune Maritime Leasing totaled approximately $123.3 million (Q1). This highlights the company’s focus on expanding its leasing platform. Hence, this initiative diversified revenue streams and leverages Costamare’s industry expertise to capitalize on leasing opportunities in the maritime sector.
In summary, Costamare’s success in securing large contracts and optimizing fleets Makes it a solid choice among the top stocks to buy.
Credo Technology (CRDO)
Credo Technology (NASDAQ: CRDO ) is an innovator in AI-driven high-speed connectivity solutions. The company demonstrated high revenue growth throughout fiscal 2024, achieving a record revenue of $193 million , reporting a 5% increase YoY. Notably, in Q4, revenue reflected a solid 89% YoY growth. This growth was primarily driven by adopting AI deployments across their product portfolio. Here, approximately three-quarters of Q4 revenue is attributed to AI workloads. Credo’s AEC product line has become a leader in in-rack cabled connectivity. This supports speeds from 100 gigabits per second to 800 gigabits per second. Hence, this segment accounted for a significant portion of their revenue growth, driven by increased demand from hyperscalers and Tier 2 data centers.
Additionally, the optical DSP products had substantial revenue gains driven by deployments in AI back-end networks. Their innovative Linear Receive Optics DSP solutions have been particularly successful. It enables significant power reductions while maintaining high-performance standards. This innovation has led to engagements with multiple 800-gig module partners and positions the company for growth in higher-speed optical modules. Thus, Credo’s top-line boom and AI leads solidify its presence among the top stocks to buy.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
On the date of publication, Yiannis Zourmpanos did not hold (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 .
Yiannis Zourmpanos is the founder of Yiazou Capital Research, a stock-market research platform designed to elevate the due diligence process through in-depth business analysis.
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