In the current market environment, even many of the most resilient businesses are seeing their share prices rise and fall significantly from one day to the next. This is true of companies across a variety of sectors.
Still, for investors who are focused on long-term investment horizons, wonderful businesses with true, long-lasting tailwinds can present particularly compelling buying opportunities right now, even in a growth-stock bear market.
Here are two such stocks that you may want to add to your buy list before the month is out.
1. Shopify
The prevalence and popularity of online shopping aren't going to wane, regardless of what happens with the economy in the next year or two. For Shopify (SHOP -2.06%), whose platform provides the infrastructure for roughly 20% of all live e-commerce sites globally, and 28% of U.S. e-commerce sites, this presents tremendous potential.
In recent months, as investor sentiment regarding growth stocks has been in flux, many have turned away from Shopify due to concerns about how a potential recessionary period and a further decline in consumer spending could affect its business. And due to a combination of aggressive investments in its growth strategy, stock-based compensation, and declines in its equity investments, Shopify -- like many growth-oriented stocks -- has been unprofitable in recent quarters.
However, looking beyond these near-term headwinds, the long term is still incredibly promising for the e-commerce giant. Shopify's already massive share of the broader e-commerce platform market is just one piece of the pie. The company provides anyone from brand-new entrepreneurs to experienced business owners with everything they need to launch and scale a company, whether it's online-only or integrated with a brick-and-mortar business.
With app integrations that help merchants connect with suppliers easily, one-stop-shop order processing and shipment through its fulfillment network (which is seeing a 450% jump in orders fulfilled by its management software, thanks to its 2022 acquisition of Deliverr), and point-of-sale devices for in-store operations, Shopify provides all the tools merchants need to succeed.
Revenue growth has decelerated from earlier pandemic levels -- which was to be expected -- but remains steady. Shopify reported top line growth of 22% to $1.4 billion in the third quarter of 2022, while gross merchandise volume and gross payment volume increased by 11% and 22%, respectively.
A promising Shopify update that affected the stock's surge in recent days was management's announcement that they intend to raise prices for the company's merchant subscription plans -- prices that have essentially remained the same for more than a decade.
These increases will be anywhere from an extra $10 to $100 a month for merchants, depending on the plan they've chosen. But in accumulation, they can contribute meaningful revenue growth for Shopify while enabling it to continue investing in its long-term vision. Wall Street has certainly responded well. For example, Citigroup analyst Tyler Radke noted the positive effect this subscription hike could have over time, while noting that these actions could boost subscription revenues by as much as 5% in 2023 alone.
For investors with extended investment horizons and the risk resilience to put money to work right now, Shopify could present an exciting opportunity. It's a market leader that's well-poised to capitalize on the durable tailwinds driving the e-commerce industry.
2. Teladoc
Teladoc (TDOC -2.59%) is working to solve problems that have plagued U.S. healthcare consumers for decades, one of which is the difficulty of accessing quality healthcare in a convenient setting without breaking the bank. Accessible healthcare is not a given for millions of Americans, whether due to inadequate insurance coverage, proximity (or lack thereof) to quality healthcare providers, health conditions that prevent them from getting to their doctors' offices easily, or other issues.
The company expanded its platform rapidly in recent years, all while moving toward the goal of becoming an all-in-one solution for people's non-emergency healthcare needs. We're talking everything from primary care to pediatric care to dermatology solutions to nutrition counseling to therapy.
While Teladoc partners with a massive and growing network of employers and health insurers, even people who don't have insurance can still use its service for general wellness visits that are 100% virtual for as little as $75. Other services like dermatology, nutrition, and mental healthcare solutions are also available to uninsured patients.
While Teladoc paid a hefty $18.5 billion price to acquire Livongo in late 2020 -- and had to write down $6.6 billion in impairment charges on that deal in the first quarter of 2022 -- there's no denying the positive effect the integration of this business is having and will continue having on the company. Chronic care management remains a notable segment of management's long-term plan for Teladoc's growth. According to a recent report by KBV Research, it's a market set to reach a valuation of nearly $10 billion by 2028.
In Q3 2022, Teladoc hit a milestone of 791,000 members enrolled in one or more of its chronic care programs, a 9% year-over-year increase. It generated $1.8 billion in revenue in the first nine months of 2022, a 20% year-over-year increase. The company is also seeing rapid adoption of BetterHelp, its online therapy business, which is estimated to have contributed $1 billion to Teladoc's top line in 2022. For people looking to invest in the future of the healthcare space, Teladoc remains a no-brainer buy with a long runway for growth.
