No investment is totally impervious to the environment in which it exists. In a time where recession concerns remain for many investors, and the market is continuing to deal with regular bouts of volatility, it can be easy to lose sight of your long-term investment horizon and get caught up in the day-to-day machinations of the market.
However, if you're investing in stocks for a period from three to five years up to decades, this long-term mindset will not only help you to be highly selective in the stocks that you buy, but can also help you ride out the inevitable volatile periods with greater mental fortitude.
If you're looking for two compelling businesses to invest $1,500 in this month, here are two names to consider hitting the buy button on right now.
1. Fiverr
Fiverr (FVRR -1.81%) continues to help customers, from small enterprises to massive brands, connect with freelancers that meet their business needs. On the other side of that equation, Fiverr remains a leading platform for freelancing professionals with skills across hundreds of specialties to connect with clients all over the world.
Even if a recession were to hit, the long-term tailwinds driving the gig economy, which is an increasingly important segment of the overall labor economy, look poised to persist well beyond any such period.
The desire for flexible work options and freelance talent isn't curtailing, it's growing. The pandemic certainly promoted the rise of remote and gig work. But now more than ever, workers are looking for ways to earn money on their own terms, whether to replace their full-time job or create a supplemental stream of income.
The benefits of the gig economy aren't solely tied to gig workers, either. For companies of all sizes, the advantage of being able to contract talent on an as-needed or long-term basis without hiring full-time employees is clear in any environment, and even more so in the current macro landscape where corporate belts are tightening.
Fiverr's platform seamlessly engages both sides of the growing gig economy. Even in a difficult operating environment, the company's continued rollout of new digital products and services, as well as tools to help both freelancers and the clients hiring them succeed, is clearly paying off.
Fiverr added 20 new gig categories in the first quarter of 2023 alone, many of which were AI-centric. For example, businesses can now hire AI artists on Fiverr or retain freelancers to construct AI-based models or apps.
Fiverr reported revenue of $88 million in the first quarter, a 1.5% increase from the prior-year period, but a 30% jump on a two-year basis. Buyers of freelance services were spending 4% more on the platform as of the end of the first quarter than they were at the same time the prior year, while Fiverr closed out the three-month period with 4.3 million active buyers globally.
Now Fiverr takes a 30.4% cut of all transactions completed on the platform, compared to 29.6% one year ago and 27.2% two years ago.
Over the trailing 12 months, Fiverr has pulled in revenue totaling about $339 million. The company isn't profitable yet, but it shaved its net loss down in the first three months of 2023 to just around a quarter of what it was a year ago. Fiverr's business serves a vital and growing force in the broader labor economy. This could create long-term tailwinds of growth that investors may want to capitalize on.
2. DexCom
DexCom (DXCM -1.95%) has amassed a business that now accounts for almost half of all sales generated in the continuous glucose monitoring (CGM) device market worldwide.
The company is targeting revenue of approximately $3.4 billion to $3.5 billion for the full-year 2023, which would represent 17% growth on the low end and 21% growth on the high end from its 2022 revenue figure. With some analysts estimating that the CGM market will hit a valuation of $8.3 billion in 2023, that would put DexCom's slice of that total right around the 40% mark.
If the company's performance in the first three months of 2023 is any indication, DexCom looks to be on a solid track to meet that goal.
The first quarter saw the company rake in revenue of $742 million, up 18% from the year-ago quarter. Of that total, $652 million was derived from sales of its CGM sensors, as well as recurring subscriptions for its hardware offerings, while the remaining $90 million came from hardware sales.
The company recently released its G7 CGM, marketed as being the most accurate CGM device and the most covered by private and public insurers that has been commercialized so far.
The G7 launch is still underway in DexCom's largest market, the U.S., having just garnered a regulatory green light from the U.S. Food and Drug Administration at the end of last year. As of the first quarter, 71% of DexCom's revenue is derived from U.S. sales, while the remaining 29% is from international markets.
In the company's year-end 2022 earnings call, management referenced a proposal by the U.S. Center for Medicare and Medicaid Services that would expand CGM coverage to type 2 diabetics on basal insulin, as well as certain patients not using insulin who have hypoglycemia. They said that this proposal, combined with the continued expansion of commercial coverage, stood to double DexCom's total reimbursed addressable market in the U.S.
Well, that CMS proposal was approved, and coverage began for these patient populations as of April.
While this is great news for any business that sells CGM devices (AbbVie is one notable example that comes to mind), DexCom's considerable market share makes it well-positioned to benefit from the generous tailwinds that coverage expansion and the rising prevalence of diabetes will provide.
This is also a profitable business. DexCom's trailing 12-month earnings total $293 million at this writing. With CGM use cases spanning the type 1 and type 2 diabetes markets, and even including individuals with prediabetes in certain instances, there is a lot of room left for this healthcare stock and its shareholders to flourish.
