The Best Stocks to Buy With $100 Right Now

After a brutal 2022 for investors, this year has started off well. So far, the S&P 500 is up 7% on the year and the Nasdaq Composite has gained 16%. This positive start to 2023 may have investors looking for solid stocks to buy -- and the good news is that even with a small amount of cash to invest, there are plenty of great options.

I like to buy companies with a long track record of success that are leaders in their respective industries. Three in my sights now are The Trade Desk (TTD -0.99%), Fortinet (FTNT 2.28%), and PayPal (PYPL 0.77%) -- all trading for less than $100. Let's dig in to see why these companies are a buy.

The Trade Desk

Advertising is ubiquitous in our lives and that's not likely to change. However, the way in which consumers see advertising in their homes has been shifting. As more people cut the cord and switch from linear TV to streaming TV, a new world of advertising is available to companies and brands.

The Trade Desk has become the leader in ad-buying, using its platform to help ads get in front of the right consumers at the right time. Rather than the old way of buying ads blindly and hoping they're effective, The Trade Desk's platform allows companies to target their ads and get data on their effectiveness.

The Trade Desk's success in this space is clear. Since fiscal 2015, the company has grown its gross spend (the total amount of client purchases on the platform, plus fees) at a compound annual rate of 46%. 

This growth will continue to be driven in part by connected TV. As more consumers switch to streaming services, connected TV advertising will continue to grow as the cost of paying for multiple streaming services ad-free is likely too great for most. The Trade Desk already has a huge head start, with its ads currently reaching more than 90 million households and 120 million connected devices. 

Fortinet

Much like digital advertising, cybersecurity is a market with incredible tailwinds behind it. Even in a macroeconomic environment where corporations are laying off employees to improve profitability, cybersecurity isn't an expense any company can afford to cut. 

There are some popular names in this space, but one that tends to fly a bit under the radar is Fortinet. While it may have a lower profile, Fortinet has been winning over customers thanks to its effective end-to-end protection services. Fortinet puts up strong and consistent growth year after year.

Data source: Fortinet. 

These strong results are also expected to continue, with Fortinet estimating its fiscal year 2023 billings to grow by 21% while revenue increases by 22% and operating margin contracts slightly to 25.5%. 

Looking further out, Fortinet is targeting fiscal year 2025 billings of approximately $10 billion and revenue of $8 billion. Both of those projections would represent an approximate doubling from fiscal year 2022, when Fortinet had billings of $5.6 billion and revenue of $4.4 billion.

PayPal

Fintech platform PayPal has grown its user base rapidly over the course of its history. Between 2015 and 2019, active accounts grew by 69%. However, that rate has slowed and between 2019 and 2022 active accounts grew by only 43%. Zooming in even further, active accounts in 2022 grew only 2% over 2021.

PayPal has acknowledged that accounts will likely grow more slowly and has instead decided to focus on its core customers with efforts to increase activity on the platform. To that end, the results show some success.

In Q4 of 2022, the total number of payment transactions grew by 13% over Q4 of 2021. That represented the sixth consecutive quarter of double-digit growth. Over the past year, PayPal's take rate has increased from 2.04% to 2.07%. This is most easily illustrated by the trend of transactions per active account over the past year.

Data source: PayPal. 

PayPal stock is down 76% from its mid-2021 high and it stands to reason that some of that drop is due to slowing user growth. However, PayPal is showing it's been able to grow transactions on its platform, and that's a revenue cash-flow driver for the company. In 2022, PayPal grew its revenue by 9% and generated $5 billion in free cash flow.