Growth stocks in the technology sector have led the market to rebound in 2023. After companies like Nvidia and Amazon reported blow-out earnings results, investors are on the hunt for the next no-brainer growth stocks.
Artificial intelligence, cloud computing, and payments are all set for rapid growth over the next decade. The global artificial intelligence market is on the rise, and PwC estimates that it will contribute $15.7 trillion to the global economy by 2030 (PwC, 2023). This will drive growth across industries including payments, energy, cybersecurity, and cloud computing.
With the new bull market in effect, these 3 no-brainer growth stocks are ripe for superior returns over the next decade.
Below are my top three no-brainer stock investments to buy ASAP!
Visa (VISA)
Visa (NYSE:V) stock is currently a strong buy as a result of current macroeconomic tailwinds fueling the company’s net income. The U.S. economy is still growing modestly, but higher interest rates are weighing on the consumer.
When the Fed reacted late on inflation in 2021, its hand was forced to rapidly raise interest rates in 2022 and crush economic growth.
However, payment giants such as Visa are benefitting significantly from higher interest rates. In Q3 2023, Visa saw total net revenues of $8.1 billion up 12% year-over-year. Net income was $4.2 billion, up 22% year-over-year.
EPS (Earnings Per Share) came in at $2.00, up 25% year-over-year. Growth was largely driven by an increase in payment volumes, cross-border volumes, and processed transactions. The company is seeing strong growth in emerging markets, with cross-border transactions up 22% year over year
Their recent acquisition of Pismo will be accretive to their strategic positioning in Latin America and Asia Pacific. Over the last 3 years, Visa has outperformed its peers and its free cash flow has grown substantially.
From March 2017 – June 2023, Visa’s FCF has grown from $5.06 billion to $18.66 billion. This has nearly tripled in the last 6 years. With credit card debt in the United States surpassing $1 Trillion in 2023, Visa stock is a buy as it will be one of the largest beneficiaries of higher interest rates.
Arista Networks (ANET)
Arista Networks (NYSE:ANET) stock is an American cloud computing company that is flying under investors’ radar.
The company is a leader in end-to-end cloud networking solutions for data centers. Arista is positioning itself well in the artificial intelligence and high-performance computing (HPC) race.
As a founding member of the Ultra Ethernet Consortium (UEC), Arista has led the development and collaboration of ethernet interoperability. ANET shares have risen more than 50% YTD, driven by strong growth in the company’s top and bottom lines.
Arista’s Q2 2023 revenues grew to $1.46 billion, up 38.7% year-over-year. Net income came in at $491.9 billion, up 64% year-over-year. EPS (Earnings Per Share) was $1.55, up 65% year-over-year. CEO, Jayshree Ullal gave its shareholders upbeat guidance for the year, alluding to YOY growth in excess of 30%.
The company also announced that it has surpassed more than 75 million cumulative cloud networking ports. Arista is well-positioned to address the gap in universal cloud network operating systems. Furthermore, they will play a significant role in data-driven AI network infrastructure.
Their flagship platform Cloudvision, will drive network flow optimization for data centers with increased visibility for automated tasks. As the company builds its foundation in the AI race, Arista Networks is one of the best growth stocks with a clear upside for 2023.
Palantir (PLTR)
Palantir (NYSE:PLTR) should be on investors’ radar as one of the best no-brainer growth stocks to buy for 2023. The company is currently up more than 100% YTD, driven by increased demand for artificial intelligence.
2022 was an extremely rough year for growth stocks, especially Palantir. The stock fell more than 75% from its all-time high in 2021, as a result of higher interest rates and quarterly losses. However, 2023 looks like the company is ready for a complete turnaround.
Its CEO, Alex Karp said it will achieve its first full year of GAAP profitability in 2023. For Q1 and Q2 2023, Palantir saw net income of $17 million and $28 million, respectively. Total revenue grew across all segments, with customer counts up 38% year-over-year in Q2 2023. PLTR is well capitalized for future growth, with approximately $2.9 billion in cash and short-term securities.
This will allow them to re-invest back into the business and continue to grow its net income year-over-year They have also hinted at an S&P 500 inclusion in 2024, which will drive increased visibility and demand for the company. With growing demand for AI solutions, Palantir is one of the top no-brainer growth stocks to buy for 2023.
On the date of publication, Terel Miles 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.
