After a tough 2022, growth stocks have regained their footing in early 2023. The Vanguard Growth Index Fund is up by a healthy 8.8% so far this year, and the iShares Russell 1000 Growth ETF has tracked higher by 7% over this same period. Both of these bellwether growth indices have outperformed the benchmark S&P 500 through the first two months of 2023. 

Charts showing the Vanguard Growth and iShares Russell 1000 Growth ETFs beating the S&P 500 so far in 2023.

VUG data by YCharts

Which growth stocks are best positioned to benefit from this trend reversal? Stocks that are moving higher on improving fundamentals are always worth checking out. Here are three growth-oriented companies heating up in response to an important change to their fundamental story. 

1. Sarepta Therapeutics

Sarepta Therapeutics (SRPT -0.11%) is a rare disease specialist. The company currently sports three U.S. Food and Drug Administration (FDA)-approved therapies for the inherited muscle-wasting disorder Duchenne muscular dystrophy (DMD). Sarepta's shares have jumped by 59% over the prior 12 months in response to the possibility of a fourth FDA approval. On May 29, 2023, the FDA is expected to hand down its regulatory decision for SRP-9001 for the treatment of ambulant people with DMD.

What's the big deal? Sarepta believes this Roche-partnered medicine could generate upwards of $4 billion in sales at peak. What's more, this indication has proven to have an extremely high barrier to entry, with nearly every experimental therapy failing in clinical studies. SRP-9001 thus sports an exceedingly high commercial ceiling, and a built-in competitive moat. Bullish analysts, in turn, think this biotech stock has another 53% upside potential.  

2. Hims & Hers Health

Hims & Hers Health (HIMS 9.68%) is a niche healthcare company. Through its multi-specialty telehealth platform, it connects patients with licensed healthcare professionals. The Hims & Hers Health digital platform allows patients to receive prescription treatments for a range of conditions such as sexual health, hair loss, dermatology, mental health, and primary care.

Although the company's cloud-based telehealth business model is far from unique, Hims & Hers Health has been racking up market share at a breakneck pace of late. Over the past two years, the company's subscriber base has risen by 190%, causing its annual online revenues to more than quadruple over this period. Hims & Hers Health has been able to wrestle market share away from entrenched competitors through its unique marketing campaign focusing on taboo conditions such as sexual health and hair loss. 

Hims & Hers Health stock price has benefited in a big way from its improving fundamentals. Over the past 12 months, the company's share price has stormed higher by an eye-catching 120%. 

Nonetheless, this niche healthcare stock ought to have a lot more room to run in the years ahead. After all, Hims & Hers Health has only scratched the surface of its massive addressable market.  

3. MercadoLibre

MercadoLibre (MELI -0.54%) is an e-commerce giant in Latin America. The company has also built a rapidly growing fintech ecosystem to attract new users to its platform, and subsequently keep those users on site. The company's shares sank along with other e-retailers in 2022. However, MercadoLibre's stock has climbed higher by approximately 42% since the start of 2023. 

Chart showing rise in MercadoLibre's price in 2023.

MELI data by YCharts

What's sparking this abrupt turnaround? MercadoLibre is staring down a huge commercial opportunity with the ongoing expansion of e-commerce throughout Latin America. Moreover, the company has carved out a viable competitive moat with the advent of its integrated digital payments platform Mercado Pago and best-in-class shipping solution Mercado Envios. 

MercadoLibre, in turn, ought to continue to capture market share at a rapid clip and keep would-be competitors at bay. That potent combination bodes well for the e-commerce giant's long-term outlook.