Momentum attracts many investors. Making significant gains on a stock within a short time can result in a lot of capital going toward a small number of stocks.
It’s risky to chase stocks soaring beyond their valuations, especially if their current financial strength faces several questions about sustainability. However, some stocks have enjoyed healthy rallies that indicate long-term potential.
These three tech high-fliers to buy have been winning in 2024 and can reward long-term investors.
Duolingo (DUOL)
Duolingo (NASDAQ:DUOL) has everything you would want except for its valuation. Shares have dropped a bit after a 22% surge due to the company’s latest earnings report. The company has taken off recently, but any pullbacks can offer a great opportunity before the growth train regains momentum.
Duolingo currently has a 141 forward P/E ratio. This is a higher valuation than many value investors may like. However, the company has experienced significant net income growth and will further reduce costs using artificial intelligence.
Growth isn’t a problem, as the company reported a 45% year-over-year increase in revenue. Daily and monthly active users jumped by 65% and 46% year-over-year respectively. The company even turned a $13.9 million net loss from the same period last year into a net income of $12.1 million.
This transformation has many investors excited about the company’s future. While the valuation makes the company vulnerable to pullbacks, the educational app looks enticing for investors with 5-10-year time horizons.
Intuit (INTU)
Intuit (NASDAQ:INTU) has a long history of generating momentum and rewarding long-term investors with financial strength. The stock is up by 62% over the past year and has gained 171% over the past five years.
Millions of taxpayers and small business owners use the company’s software products. TurboTax, QuickBooks and Mailchimp are some of the firm’s offerings. Intuit also owns CreditKarma and Mint, two resources that generate revenue and strengthen the company’s presence in the finance industry.
The company continued its streak of improving revenue and net income. A 110% year-over-year jump in net income complemented Intuit’s 11% year-over-year revenue growth in the second quarter of fiscal 2024.
The “Small Business and Self-Employed Group” segment headlined the press release. Revenue from this segment was up by 18% year-over-year, making up more than two-thirds of the company’s A2 FY24 revenue. Intuit reiterated its full-year guidance, which suggests revenue growth ranging from 11% to 12%.
Amazon (AMZN)
Amazon (NASDAQ:AMZN) shares have almost doubled over the past year as the e-commerce component delivers promising growth numbers. Net sales reached $170 billion on the back of a record-breaking holiday shopping season. That’s a 14% year-over-year improvement.
Sales in North America increased by 13% year-over-year, while international revenue jumped by 17% year-over-year. International markets present more opportunities for the company, but it’s nice to see that it can still maintain double-digit growth rates in domestic markets. Amazon Web Services generated 13% more revenue in Q4 2023 than last year’s period.
Amazon makes most of its revenue from e-commerce and cloud computing. However, the company is growing its advertising segment at a fast rate. Investments in artificial intelligence can also bear fruit and increase revenue and profit margins.
The tech firm also earned $10.6 billion in net income during the quarter. The sharp rebound in net income growth can lead to more investor gains.
On the date of publication, Marc Guberti 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.
