What makes you confident that a stock has a great chance of making strong profits? Maybe this is the previous presentation of the shares. Maybe this is a huge market opportunity. The company can have a clear competitive advantage that you really like. Or you may just have a positive instinct for stocks.
These are all answers that I would probably give when I answer the question. A good exercise at the beginning of each year is to review the stocks you own (or want to buy) to assess how confident you are in their prospects. I did this recently. Here are my three growth stocks with the highest persuasiveness for 2021.
Fiverr (NYSE: FVRR) absolutely crushed him in 2020, as his shares jumped 730%. Even with this huge profit, the company’s market capitalization is still only about $ 8 billion.
There are many websites that allow companies to find freelancers. Many of them are mainly recruitment agencies. In freelance practice, they often have to bid for jobs and negotiate contracts. Fiverr’s e-commerce platform is different. An approach as a service as a product is needed. Freelancers publish their skills, experience and a certain price for what they will do. There is no bidding or bargaining. Buyers know exactly what they are getting for their money.
This haggling approach works really well for Fiverr. The number of active buyers of the company has grown by more than 70% in the last three years – without any sales. The average cost per buyer jumped by nearly 64% over the same period. Fiverr’s revenue growth is accelerating, increasing by 88% in the third quarter of 2020 compared to the previous year.
The company estimates that its total target market in the United States is about $ 115 billion a year. But this market is growing. As a result of the COVID-19 pandemic, more and more people are working remotely and are interested in freelancing to supplement their income. However, Fiverr is not only aimed at the US market. It continues to expand internationally. I am very optimistic about the company’s prospects in 2021 and beyond.
Etsy 09.30 NASDAQ: ETSY the stock has more than quadrupled last year. The e-commerce platform for handmade goods really clicked with customers during the pandemic. Etsy especially received a boost from sales of face masks. But I don’t think the momentum will weaken once the pandemic is over.
Of course, 11% of Etsy’s total gross sales of goods (GMS) in Q3 came from sales of face masks. However, the company’s GMS jumped 93% year-on-year, excluding sales of face masks. My opinion is that customers attracted by Etsy in 2020 mainly to buy a face mask are likely to return to the platform to buy other products. In other words, the pandemic will be a long-term engine of growth for Etsy, instead of providing only a temporary boost.
The biggest competitive advantage for Etsy is its uniqueness. In a 2019 survey, a whopping 88% of shoppers said Etsy was selling items they couldn’t find anywhere else. Etsy retailers are usually small businesses, many of which sell personalized handmade products. This distinguishes Etsy in terms of customer attractiveness, but also in terms of productivity: Etsy’s sales are growing more than twice as fast as the Ministry of Commerce’s e-commerce benchmark.
Even with its impressive growth, Etsy still claims only a 5% market share of the annual market of $ 100 billion for what it calls “special” products (unique handmade items). But the company’s real target market is probably nearly $ 250 billion a year, and maybe even more. I totally expect Etsy to continue its profitable paths this year and the rest of the decade.
3. Intuitive surgery
Robotic pioneer surgical system Intuitively surgical‘s (NASDAQ: ISRG) the business was hit hard by the coronavirus outbreak. Non-performing operations were postponed for part of 2020. As a result, Intuitive’s revenue fell 22% year-on-year in Q2 and 4% in Q3. However, its shares still jumped 38% in 2020, as investors expected better days ahead.
I think these better days will come this year. Two vaccines against COVID-19 are currently available in the United States, with millions of Americans already at least partially vaccinated. There is reason to hope that life will soon begin to return to normal. This means that delayed surgical procedures will be scheduled again.
Intuitive Surgical makes the lion’s share of its revenue from the sale of replacement tools and accessories. When more procedures are performed using its robotic da Vinci surgical systems, Intuitive’s revenue increases. I predict this will happen in 2021. What really makes Intuitive Surgical so highly reprehensible to me, however, is its long-term potential.
Aging populations around the world will stimulate increased demand for surgical procedures. Meanwhile, Intuitive continues to launch innovative new products to expand the types of procedures that can be performed with the help of surgical robots. Intuitive’s market opportunities are huge, as currently only a small percentage of procedures can be done with robotic assistance. My opinion is that Intuitive Surgical is almost a helmet to win in the long run.