Economists around the world are expecting U.S. economic growth to slow in the second half of 2023 and in 2024, and many are calling for at least a mild U.S. recession. It may become increasingly difficult for investors to find reliable growth stocks to buy. Nevertheless, growth stocks have outperformed value stocks in 2023, and investors are anticipating that trend will continue when the Federal Reserve eventually pivots to interest rate cuts.
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Here are 10 of CFRA Research analysts’ top growth stocks that have reported at least 15% annual revenue growth in the past three years:
| Stock | Implied upside from Oct. 19 closing price |
| Alphabet Inc. (ticker: GOOGL) | 3.1% |
| Amazon.com Inc. (AMZN) | 42.5% |
| Nvidia Corp. (NVDA) | 42.5% |
| Meta Platforms Inc. (META) | 11.9% |
| Tesla Inc. (TSLA) | 40.8% |
| Chevron Corp. (CVX) | 6.4% |
| Adobe Inc. (ADBE) | 11.6% |
| Salesforce Inc. (CRM) | 22.9% |
| Pfizer Inc. (PFE) | 37.9% |
| Advanced Micro Devices Inc. (AMD) | 41.6% |
Alphabet Inc. (GOOGL)
Alphabet is one of the world’s largest online search and advertising companies and is the parent company of Google and YouTube. In the second quarter, Alphabet reported 7% revenue growth, which included 28% cloud revenue growth. Analyst Angelo Zino says artificial intelligence technology will help fuel long-term revenue growth, while accelerating growth from YouTube in the second half of 2023 could serve as a near-term catalyst for the stock. He says Alphabet is positioned to maintain 6% to 11% annual revenue growth through at least 2025. CFRA has a “buy” rating and $142 price target for GOOGL stock, which closed at $137.75 on Oct. 19.
Amazon.com Inc. (AMZN)
E-commerce and cloud services giant Amazon has been one of the best-performing growth stocks of all time. Unfortunately, Amazon shares are down 19.1% overall in the past three years as annual revenue growth has slowed to just 10.9% in the second quarter. Analyst Arun Sundaram says Amazon’s e-commerce business is becoming more profitable, and its advertising business is growing at an impressive clip. Sundaram says Amazon’s profitability profile will continue to improve as the advertising business expands, and he projects 11% revenue growth for 2023. CFRA has a “buy” rating and $183 price target for AMZN stock, which closed at $128.40 on Oct. 19.
Nvidia Corp. (NVDA)
High-end semiconductor maker Nvidia has been one of the most spectacular growth stories in the stock market in the past 15 years. In the second quarter, Nvidia’s growth numbers rebounded in a major way, suggesting a cyclical downturn in the semiconductor market may finally be over. Nvidia’s revenue grew 101% year over year in the quarter, while its net income skyrocketed by 843%. Zino says AI investments have created a boom in demand for Nvidia’s chips, and he projects 36% revenue growth in fiscal 2025. CFRA has a “buy” rating and $600 price target for NVDA stock, which closed at $421.01 on Oct. 19.
Meta Platforms Inc. (META)
Meta Platforms is a market leader in social media and online advertising and is the owner of Facebook, Instagram and other platforms. After three straight quarters of year-over-year revenue declines to close out 2022, Meta’s growth rebounded to 11% in the second quarter of 2023. Zino says AI technology, the metaverse and Reels are three growth catalysts for Meta. He says the company is also regaining market share from competitors. Zino projects more than $30 billion in free cash flow and 10% revenue growth in 2024. CFRA has a “buy” rating and $350 price target for META stock, which closed at $312.81 on Oct. 19.
Tesla Inc. (TSLA)
Tesla is the leading U.S. electric vehicle manufacturer. Tesla reported impressive year-over-year 47.2% revenue growth and 19.6% net income growth in the second quarter. Automotive segment revenue was up 46%. Analyst Garrett Nelson says the opening of new Tesla factories in Germany and Texas and the start of Cybertruck deliveries will facilitate the next Tesla growth phase. In addition, the Roadster and the Optimus robot will serve as future Tesla growth catalysts. Nelson projects 21% revenue growth in 2023 and 36% growth in 2024. CFRA has a “buy” rating and $310 price target for TSLA stock, which closed at $220.11 on Oct. 19.
Chevron Corp. (CVX)
Chevron is a global oil major that operates exploration and production, refining, marketing and petrochemical businesses. Oil majors aren’t normally considered high-growth stocks, but favorable energy market conditions in recent years have made oil stocks some of the highest-growing companies in the market. Chevron reported a 28% year-over-year drop in revenue in the second quarter, but revenue was still up about 30% on a two-year basis. Analyst Stewart Glickman says Chevron has successfully deleveraged its balance sheet and will return to earnings and revenue growth in 2024. CFRA has a “buy” rating and $180 price target for CVX stock, which closed at $169.10 on Oct. 19.
Adobe Inc. (ADBE)
Adobe produces creative content software and other applications used for marketing and e-commerce. Adobe reported 10% revenue growth in the third quarter, including 11% growth in its digital media segment and 10% growth in its digital experience segment. Zino says Adobe has significant AI monetization and cross-selling opportunities given its leading share of key content creation apps. He says the company has subscription pricing leverage and AI integration will support user growth. Zino projects 11% revenue growth in fiscal 2024 and 13% growth in 2025. CFRA has a “buy” rating and $620 price target for ADBE stock, which closed at $555.74 on Oct. 19.
Salesforce Inc. (CRM)
Salesforce is the world’s largest provider of cloud-based customer relationship management software. In addition to its organic growth, Salesforce has grown via a string of acquisitions in recent years, including its 2021 buyout of workplace messaging platform Slack. Salesforce reported 11% year-over-year revenue growth and a whopping 1,763% net income growth in the second quarter. Zino says Salesforce has a bullish combination of an attractive valuation, a growing market share and opportunities for improved profitability. Zino projects annual revenue growth of between 9% and 11% through at least fiscal 2026. CFRA has a “strong buy” rating and $256 price target for CRM stock, which closed at $208.32 on Oct. 19.
Pfizer Inc. (PFE)
Pfizer is one of the largest global pharmaceutical companies. In the past two years, Pfizer has generated impressive sales from its COVID-19 vaccine and booster shots. However, the stock is down 39.1% through Oct. 19 this year as COVID sales have died down. Pfizer’s revenue dropped 54.1% in the second quarter, but the company guided for between 6% and 8% operational revenue growth this year, excluding COVID product sales. Analyst Sel Hardy says Pfizer’s drug development pipeline has the potential to generate $20 billion in new revenue by 2030. CFRA has a “buy” rating and $43 price target for PFE stock, which closed at $31.19 on Oct. 19.
Advanced Micro Devices Inc. (AMD)
Shares of microprocessor and graphics semiconductor stock Advanced Micro Devices are up a whopping 2,800% over the past decade. AMD reported an 18% year-over-year drop in revenue in the second quarter, thanks in large part to a cyclical downturn in personal computing and traditional server demand. However, the company guided for double-digit revenue growth in both its data center and client segments in the third quarter. Zino is bullish on the ramp-up of AMD’s next-generation EPYC processors, and he projects 21% revenue growth in 2024. CFRA has a “buy” rating and $145 price target for AMD stock, which closed at $102.40 on Oct. 19.
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10 Best Growth Stocks to Buy for 2023 originally appeared on usnews.com
Update 10/20/23: This story was previously published at an earlier date and has been updated with new information.
