We are still in a bear market now, but history tells us that a bull market is coming. It's not a question of if it will happen, but rather when.
For investors who want to get ahead of this coming bull market, now's the time to research potential winners that will excel when it comes. Here are three supercharged growth stocks that could skyrocket higher once the bull market finally gets going.
Image source: Getty Images.
1. Advanced Micro Devices
Advanced Micro Devices (AMD -1.81%), also known as AMD, is one of the world's foremost suppliers of cutting-edge microprocessors. AMD produces a variety of chips used in everything from automobiles to gaming devices. The company's largest, most profitable segment makes server processors, which are used to power the world's data centers.
Many companies make data center processors (IBM, Intel, and Qualcomm, are some other examples), but AMD might have a leg up on the competition thanks to its record of innovation and some strategic partnerships it's made. For example, AMD recently teamed up with Microsoft on a collaborative venture where AMD's EPYC processors help operate Microsoft Azure's virtual machines. Associations like this can help AMD reinforce its image as a go-to name for chips used in top-of-the-line data centers.
From a financial perspective, AMD's short-term future presents a mixed image. Wall Street analysts expect 2023 revenue to be flat as lingering weakness in the PC market cancels out skyrocketing growth in the company's Data Center segment. Analysts expect growth to return with a bang in 2024. Consensus estimates are for 17% revenue growth, bringing the company's total revenue for 2024 to $27.7 billion.
AMD's stock price is up more than 46% so far in 2023, but it is still down 41% from all-time highs set in 2021. There's still more growth available here.
2. Teradyne
Teradyne (TER -1.37%) fills a unique niche by designing and producing automated test systems for the semiconductor industry. Revenue tumbled in 2022 as a glut of semiconductors slowed overall demand. However, the company's 10-year average growth rate on revenue is 8.6%.
TER Revenue (Quarterly YoY Growth) data by YCharts
The demand for Teradyne's testing systems increases as chip complexity grows. And with more and more complex chips coming down the pipeline to help fuel artificial intelligence, machine learning, and automotive advancements, Teradyne stands to benefit.
Looking ahead, analysts expect Teradyne's revenue to contract to $2.8 billion this year. However, Wall Street estimates revenue should rebound substantially to $3.5 billion in 2024. While it waits for the rebound, the company's balance sheet gives it a large cushion. Teradyne has over $890 million of cash available and only $133 million of debt.
Teradyne stock trades 38% below all-time highs set at the start of 2022, but it's up nearly 20% so far in 2023. For investors that want to spice up their portfolio with a mid-cap semiconductor-related stock, Teradyne is a name to remember.
3. Tesla
While 2022 saw the stock price for electric vehicle (EV) maker Tesla (TSLA -5.59%), fall significantly after an incredible runup over the prior two years, 2023 is off to a much better start. The company reported stellar quarterly earnings back in January, with the following highlights:
- $24.3 billion in revenue -- up 37% year over year.
- $1.19 of adjusted earnings per share (EPS).
- 1.31 million vehicle sales for all of 2022 -- up 40% year over year.
Adding fuel to the fire, Tesla's net income per employee hit $110,792 last year. That's a record high for the company, far outpacing Tesla's closest competitors.
TSLA Net Income Per Employee (Annual) data by YCharts
Nevertheless, investors can snap up shares of the world's largest automaker (by market cap) at a discount. Tesla stock still trades 52% below its all-time high, set in 2021. For investors looking to gain a step on the market, now might be the time to load up on Tesla -- before the next bull market gets underway.
