Growth stocks are always an exciting segment in the stock market. Before we enter 2022, the fourth quarter of 2021 is a perfect time to analyze the market and look for the best investments. Growth stocks are graded in high ranks. Therefore, we will go through the best growth stocks for October 2021.
According to Forbes and many other market analysts, the 4th quarter of 2021 could launch a healthy 2022 stock market. Some exciting stocks have a high growth potential heading into the following year.
Tesla Inc. (TSLA)
We have covered the technical and the market trends of the season, and Tesla Inc. (TSLA) seems to rush upwards by the end of 2021 and the beginning of 2022.
Tesla is the world’s largest EV maker by market cap, nearly reaching the $800 billion mark. Since the pandemic, Elon Musk’s car company has deceived the stock market and soared to new highs. If we follow last year’s trend of TSLA stock, it looks pretty adjacent to reach the new highs.
In the last six months, TSLA stock has been pushing upward and is in a similar trend design compared to last year’s period. EV maker has a 52-week range between $379.11 – $900.40.
On the other side, Tesla is breaking delivery records every quarter. Despite a global automotive semiconductor shortage, the company delivered over 70% of cars from a year ago. Tesla surpassed the Wall Street estimates that were around 225,0000 to 230,000.
Tesla continues to increase its production, and this means that the demand is increasing as well. Strong deliveries usually mean good news for Tesla bulls down the road. TSLA stock has outperformed the S&P 500 six out of the past eight times in the span between reporting deliveries and reporting quarterly earnings.
Tesla stock’s PE Ratio (TTM) is 408.66, which means it’s highly overvalued. However, that’s how Tesla works. Analysts are rating the stock as a buy based on the recent trends of the stock.
Netflix Inc. (NFLX)
Let’s see Netflix Inc.’s (NFLX) stock based on the current trends and how it can go full in the next few months.
The stock market usually has a high buying volume during the fourth quarter. That leads investors to enjoy high profits in the first quarter of the following year.
Netflix, just like Tesla, is on a similar trend, but it might look more promising. The streaming giant was a fan favorite last year, with its stock price climbing 67%.
NFLX stock is continuing a strong trend upwards, and a couple of factors could push the stock further by the end of this year.
The very first achievement of Netflix has been its dominance at the Emmy awards. The streaming giant won 44 trophies this year, more than any other network or streaming service. Not on that, Netflix tied a long-standing record for the number of awards in a single-year setback in 1974. Now, that’s a tremendous achievement that could create a bullish impact on the stock.
Highlighting Netflix’s achievement competitively, it won more than twice the number of awards than AT&T’s HBO and HBO Max. This is really something to cherish considering NFLX stock.
Apart from that, Netflix’s latest series Squid Game has created a new buzz in the streaming network. The new Korean-language original series has already pumped the stock, and with a growing audience, things will get even better. Stifel analyst Scott Devitt recently upgraded Netflix stock to a buy rating and boosted its price target from $580 to $650.
Datadog (DDOG),
Since its IPO two years ago, Datadog (DDOG) shares have almost quadrupled. DDOG stock sits around its all-time high value. Is it still a buy at its all-time high?
Datadog is a widespread and growing observability service provider for cloud-scale applications, including monitoring of servers, databases, tools, and services. Datadog shares have stacked over 50% so far in 2021, which makes it a growth investor favorite.
Datadog’s rally is far from over as it executes at a high level and invests in future growth. The company is coming up with some stellar growth numbers. It is also winning large customers hand over fist. But why should the investors get excited about all this?
Datadog’s RPO has increased at triple digits year over year to a whopping $583 million. That means the customers are signing larger and longer contracts. The customer base has also increased. Over 75% of customers now use two or more modules, and 28% use four or more, up from 15% from the prior second quarter.
The company stands strong with 16,400 customers and the top 1,610, making up 80% of its annual recurring revenue. That allows the company to focus on expansion and continue its growth momentum. As the company adds more to its footprint each quarter, DDOG stock could really pump by the year’s end.
Chewy Inc. (CHWY)
Chewy (CHWY) stock is trading on the lower side, which could create an opportunity to enter the trade. Before discussing the trend of CHWY stock, let’s talk about the business fundamentals.
Chewy is one of those companies that benefited from the popularity of e-commerce during the pandemic. The online seller of pet supplies reported a 47% increase in net sales last year and grew its customer base by 43%.
In this year, the company has continued to report an increase in net sales and adjusted EBITDA. That means that the company holds long-term potential. In the most recent quarter, Chewy saw a 21% increase in active customers and a 13% increase in net sales per active customer. The company saw impressive results despite the opening of physical stores. That’s another encouraging signal for Chewy’s growth.
As we report, Chewy stock has major support at $65.66 and another strong support at $60. Analysts and investors maintain their confidence in Chewy. ClearBridge Investments recently stated that Chewy would maintain customer relationships it established during pandemic lockdowns and expand into international markets. Moreover, Wolfe Research has upgraded Chewy to outperform.
Intuitive Surgical (ISRG),
Intuitive Surgical (ISRG) seems like a good buy in October. Two major factors put ISRG stock on our list; the first is its strong moat, and the second is its excellent growth prospects.
The intuitive stock has soared 45% since the last year, and we could see a further push. The company has a global network with over 6,300 robotic surgical systems installed worldwide. Around 8.5 million procedures have been performed with its robotic technology so far.
As the healthcare industry continues to shift operations from humans to robots, Intuitive Surgical is all there to grow. We have seen new companies enter this space in the last few years. However, none of them have even come closer to Intuitive.
The company is investing in new features and innovation. That opens a new chapter for Intuitive Surgical’s growth prospects. The company projects its new products would expand the current market to nearly 20 million procedures annually.
As for now, the company expects to complete around 6 million procedures annually, five times more procedures performed with Intuitive’s systems last year. ISRG stock seems promising and makes onto the list of October’s growth stock.
