Goldman Sachs just upgraded these 5 growth stocks for 2022 – if you’re worried about increasing interest rates, they might be a portfolio saver. Rising interest rates are always a concern for the stock market, but not all equities are made equal.
According to Goldman Sachs, one sort of company could continue to perform well when interest rates climb next year: extremely lucrative growth businesses.
“When real rates rose in 1Q 2021, growth firms with strong profit margins outpaced unprofitable growth stocks,” says the bank’s top U.S. equities strategist, David Kostin, in a note to clients. “Profitable equities should hold up well if interest rates increase in 2022.”
Time may be of the essence. Fears that the Fed will raise interest rates soon are fueling speculation. Already, the 10-year US Treasury note yield has risen from 0.93 percent in January to 1.53 percent today. Goldman has identified five high-growth, high-profit-margin stocks to bolster your portfolio. At least one of these may be a good deal, especially if you’re investing for nothing.
Marathon Digital Holdings (MARA)
Marathon operates as a bitcoin miner. Its mining fleet has produced about 2,712 self-mined bitcoins so far this year.
While other bitcoin miners may have been tempted to sell their coins after the recent crypto rise, Marathon merely hoards them — a practice was known among crypto aficionados as “holding on for dear life,” or HODL. Surprisingly, the stock performed well throughout the crypto bubble. Despite recent volatility, Marathon stock has returned 225 percent in 2021.
The company was included in Goldman’s screening procedure since the consensus forecast for its annual revenue growth from 2021 to 2023 is 105 percent. Meanwhile, the consensus projection for its profit margin in 2023 is 51%.
Riot Blockchain (RIOT)
Riot Blockchain is another crypto play that Goldman discovered during its quest. It mines bitcoin and hosts mining hardware for institutional clients. In the third quarter, sales were $64.8 million, an increase of 2,532 percent year on year.
However, Wall Street feels that the best is yet to come. From now until 2023, the consensus annual sales growth prediction is 69 percent, with a profit margin of 46 percent. The shares, like the larger cryptocurrency market, have taken a beating in recent weeks. But now could be a good moment to strike.
Of course, there are several methods to participate in the crypto boom. Some programs, for example, allow you to pick up bitcoin ETFs or buy cryptocurrencies directly, all commission-free.
Marvell Technology Inc. (MRVL)
Right now, chipmakers are firing on all cylinders, and Marvell Technology, in particular, is attracting a lot of investor interest. Its stock has increased by 87 percent in the last year.
Marvell’s sales increased 48 percent year over year to $1.076 billion in the most recent fiscal quarter, on to rising demand from data centres, the company’s largest end market. Wall Street anticipates that the company’s revenues will expand at a 20 percent annual rate over the next two years, with a profit margin of 35 percent.
MP Materials (MP)
MP Materials is a rare earth mining firm that billionaire investor Chamath Palihapitiya assisted in taking public last year through a SPAC. Mountain Pass, North America’s only integrated rare earth mining and processing plant, is owned and operated by the corporation.
Over the last year, the stock has increased by 43 percent. One of the reasons for investor excitement is that electric vehicles (EVs) require strong rare earth magnets to convert energy into motion. Given the EV industry’s rapid expansion, MP’s outperformance should come as no surprise. By 2023, the corporation is predicted to raise its sales by 50% each year.
Mastercard has a larger market valuation than all of the previous firms combined. While smaller firms are more agile, the financial services behemoth may also generate quick development, particularly if pandemic limitations are relaxed.
In the third quarter, Mastercard’s gross dollar volume increased by 20% year on year in local currency. Cross-border volume, on the other hand, increased by a whopping 52 percent. Analysts predict that the company’s sales will grow at an 18% annual rate over the next two years.
Yes, Mastercard is currently trading at more than $360 per share. However, you may still obtain a piece of the firm by utilising a popular software that allows you to buy fractions of shares with as little or as much money as you choose.