3 Growth Stocks With More Potential Than Any Cryptocurrency

If you're a risk-tolerant investor but don't want to put cash into cryptocurrency, there are plenty of options left for you.

Growth stocks have had a volatile start to the year, with rebound days followed by days of sinking share prices. However, companies built on robust long-term businesses and industry tailwinds that can drive growth for years can present intriguing investments, even in a topsy-turvy market. 

Let's take a look at three such stocks to consider adding to your buy basket ASAP. 

1. Airbnb 

Airbnb (ABNB 0.75%) has delivered quarter after quarter of solid growth following a remarkable rebound from the worst days of the pandemic. The surge of "revenge travel," as it's been called, has certainly been a factor here. However, the changing habits of travelers in an increasingly remote-friendly working world, which is seeing more people combine work and travel together -- along with long-term growth catalysts in the travel space driving recovery in cross-border, urban, and non-urban travel -- are all elements propelling Airbnb's continued business expansion and profitability.

Management continued to emphasize the integral component that long-term stays -- which are stays of 28 days or more -- play in the company's current and future growth prospects. This segment comprised 20% of all stays booked on Airbnb's platform as of the third quarter of 2022.

While it's certainly possible that some travelers could be booking lengthier stays for vacation purposes, the continued growth of the digital economy and the increased location independence that many workers have compared to pre-pandemic days are also likely factors here. 

The third quarter of 2022 saw Airbnb grow its revenue 36% year-over-year on a constant-currency basis, while net income shot up 61% year-over-year. The company generated $960 million in free cash flow in that three-month period alone, and was sitting on a stash of nearly $10 billion in cash and investments at the end of the quarter. Airbnb's continued potential in the years ahead and established track record of growth make the stock an attractive investment through the next bull market and well beyond. 

2. Pinterest 

Pinterest (PINS 4.04%) had a series of mixed quarters following unusually high periods of growth during the earlier part of the pandemic. And ongoing macro conditions have triggered a decline in consumer spending that impacted both the top and bottom line for the business, which generates the lion's share of its revenue from advertising. 

While revenue was below what some Wall Street analysts had projected, Pinterest's 2022 results could signal the start of a longer-term turnaround for the business.

The company reported revenue of about $3 billion in the 12-month period, up a healthy 9% from 2021. While the company was unprofitable in the full year, Pinterest returned to profitability in the fourth quarter, generating $17 million in net income in the final three months of 2022. On another positive note, the number of monthly active users is growing again and Pinterest continues to effectively monetize its active user base. 

Case in point: In full-year 2022, the number of monthly active users rose 4% year-over-year, while average revenue per user surged 10% from 2021. It's also worth mentioning that when evaluating a broader lookback period, between the fourth quarter of 2019 and the fourth quarter of 2022, Pinterest's revenue increased 30% on a three-year clip, while monthly active users shot up on a compound annual growth rate basis of 10%.

Pinterest remains a highly popular platform for merchants across a range of industries to attract customers. Given the company's steady growth from pre-pandemic levels and promising 2022 results, it appears to be laying a foundation for a robust recovery when ad spending bounces back. 

3. Etsy 

Etsy (ETSY 0.34%) has a sticky and steadily growing business around a very specific niche of the broader e-commerce space. With its focus on all manner of goods that fit into the category of items that are unique, handmade, specialty, or vintage, the company rose to the top of an e-commerce sector that alone represents a total addressable market of about $2 trillion. 

That eye-popping figure doesn't include the potential market growth Etsy can tap into from other businesses in its family of brands, such as musical instrument marketplace Reverb, or Depop, the popular Gen Z platform for buying and selling pre-owned apparel.

Etsy generated revenue of $1.8 billion in the first nine months of 2022, representing an increase of 9% compared to the same period in 2021. Although Etsy clocked a net loss of $804 million in that nine-month window, this was almost entirely due to a non-cash impairment charge from writing down the value of pandemic acquisitions. 

Stepping back from unfavorable year-over-year comparisons and evaluating Etsy's growth over a more prolonged period of time, the company's third-quarter gross merchandise sales represented a three-year increase of 150%. Active buyers and repeat buyers on the platform rose by 100% and 125%, respectively, in the third quarter of 2022 compared to the third quarter of 2019.

Etsy's platform revolves around a variety of popular product categories, and the idea of buying handmade or vintage goods may be even more attractive in a difficult economic environment, where consumers are looking for meaningful, but perhaps more affordable, goods and gifts.

Over the long term, the vast and still under-penetrated potential that Etsy boasts in its niche of the e-commerce industry bodes well for this market disruptor and its shareholders.