3 Hyper-Growth Stocks Rising Above Their Counterparts
The cloud computing market could become massive. In fact, according to Technavio, it’s expected to grow by $429.6 billion from 2022 to 2027. All thanks to growth in 5G, the Internet of Things, and artificial intelligence. To potentially profit from that growth, here are three top hyper-growth stocks to consider now.
Hyper-Growth Stocks: C3.ai (AI)
Hyper-growth stocks, like C3.ai AI has seen a good deal of upside thanks to artificial intelligence. In fact, the pure-play enterprise AI software provider has experienced a 123% share surge this year as the demand for AI applications continues to rise. However, some recent developments suggest that the company’s impressive stock market rally may face challenges in the short term.
In addition, C3.ai’s financial results for Q3 2023 were recently released, and although revenue increased slightly compared to the previous year, the stock’s rapid growth may have exceeded its financial performance. The CEO of C3.ai, Tim Siebel, believes that the market for AI software will soonbe worth $600 billion. According to Siebel, AI will become as ubiquitous as PCs, relational databases, and customer relationship management software, with everyone using enterprise AI applications.
Also, C3.ai is expected to report lower growth in fiscal 2023 due to a shift in its business model from subscription-based to consumption-based. The change is anticipated to drive faster adoption of its enterprise AI software, enhance its sales cycle, and increase revenue and profitability.
Nvidia NVDA rocketed 62% year-to-date and is one of the top-performing stocks this year. Positive Q3 results and a promising outlook in Feb. suggest the stock will remain strong, with a long growth runway ahead.
Even better, a Q1 projection that exceeded analysts’ projections andpredicted a 7% consecutive increase in revenue to $6.5 billion further contributed to NVDA’s outstanding achievement. Adjusted gross margins are also expected to increase to 66%-67% compared to the previous quarter’s 63.3%, indicating the company’s pricing power in its markets.
In addition, NVDA hasa competitive advantage over its peers in the AI sector, offering a complete range of services, including AI supercomputers, algorithms, data processing, and training modules. Additionally, NVDA has an advantage in delivering AI services across various industries and continues to develop innovations. Although the semiconductor industry is currently facing a slowdown, it is expected to rebound in H2 2023, potentially adding to NVDA’s upside potential. Moreover, NVDA can broaden its scope throughout many sectors as an innovator in the AI field.
Shopify SHOP is capitalizing on the e-commerce trend. The company’s foray into different segments, such as FinTech, fulfillment, and partnerships with large firms, demonstrates its dedication to horizontal expansion. In comparison, Shopify has a distinct edge over industry giant Amazon. While Shopify is an avenue that helps companies of all sizes set up and operate their online shops, Amazon is a powerful internet-selling platform with a vast selection of merchandise.
In addition, Statista forecasts significant growth in the eCommerce market, withrevenue expected to reach $4.11 trillion in 2023 and the market volume projected to be $6.35 trillion by 2027. With a predicted marketplace value of $1.487 trillion in 2023, China will lead in income creation as the number of users rises to 5.29 billion by 2027.
Also, by expanding its portfolio and exploring new areas, Shopify is setting itself up for continued growth and triumph in the future. According to optimistic predictions, the online retail sector will develop significantly in the coming years, and Shopify will benefit greatly from this development.
On the date of publication, Chris MacDonald 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.
Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.