2 Incredible Growth Stocks to Buy With $1,000 Right Now

Growth stocks tend to experience more highs and lows than your average stock, and that's even more true in the turbulent markets of the past few years. There are rumblings that a new bull market is about to start which suggests good things for growth.

Whether the beginning of a true bull market is here or more volatility (and even a recession) lies ahead, it will take time and patience to manage your portfolio within it. As many growth-oriented businesses are faring quite differently in the current market environment, you need to be selective. What stocks will serve as the most compelling use of your investment capital for the long term?

If you have $1,000 available to put toward stock purchases that isn't needed for monthly bills or to pay down short-term debt, you might want to consider using it to buy stock in two businesses with compelling business models and the potential for long-term market-beating returns. 

1. Shopify 

Shopify (SHOP 1.11%) is making strides in a challenging spending environment, offering its software to fuel versatile use cases for merchants and consumers both online as well as offline. Investor sentiment has returned to excitement over this company and the stock price is up around 90% since the start of 2023 compared to the S&P 500's upward journey of about 16%. 

Even as fears of a recession persist, Shopify merchants boosted product volume by 17% year over year in Q2. Gross merchandise volume hit the $55 billion mark for the quarter, while Shopify revenue soared 31% from the year-ago period to $1.7 billion.  

New merchants continue to flock to Shopify's platform, with subscription-solutions revenue for the three-month window popping 21% year over year to $444 million. Meanwhile, merchant-solutions revenue (which includes revenue derived from sources like payment-processing fees and transaction fees) soared 35% year over year in Q2 to $1.3 billion.  

Although Shopify still needs to work to get back to consistent profitability, this was the company's third consecutive quarter of being cash-flow positive. The company generated just shy of $100 million in free cash flow in Q2.  

Shopify has recently rolled out a series of upgrades to its digital product offerings to help merchants scale their businesses and fuel customer growth, both of which are key catalysts for the company's top and bottom lines. Among these are an artificial intelligence(AI)-based suite of features to help merchants better run their businesses called Shopify Magic, a centralized selling hub that enables merchants to easily sell their products on third-party platforms called the Shopify Marketplace Connect app, and a business credit card for merchants called Shopify Credit with cash-back benefits.  

Shopify is one of the leading e-commerce platforms in the world, operating in a market that is not only valued in the trillions but is rapidly expanding. This growth story looks like it has plenty of momentum and opportunity left for investors to capitalize on. At its current price, a $1,000 investment in Shopify would earn you about 15 shares. 

2. Etsy 

Etsy (ETSY 0.34%) isn't delivering the investor-pleasing results it was in the early days of the pandemic. However, the company is still growing its family of brands, seeing a steady increase in both active buyers and sellers, and is operating profitably. 

In the first six months of this year, Etsy's family of brands (largely fueled by the Etsy marketplace) pulled in $1.3 billion of revenue on gross merchandise sales of $6.1 billion. That revenue figure represented a 9% spike from the same six-month period in 2022.  

While that gross merchandise sales figure was down year over year, it's worth mentioning that this metric was more than double what Etsy reported in the same six-month window in the pre-pandemic year 2019. While Etsy's bottom line has been growing at a slower rate in recent quarters, the company still pulled in $136 million in profits in the first six months of 2023.

Active buyers on Etsy surpassed the 96 million mark in the first half of 2023, while active sellers eclipsed 8.3 million. Those figures were up 3% and 12%, respectively, from the first half of 2022.  

Management noted in the recent earnings report that the Etsy marketplace onboarded 6 million new buyers in Q2 alone. It also reactivated 21% more buyers in Q2 2023 than in the same quarter in 2022.  

It's also worth pointing out that the Etsy marketplace, the most significant source of revenue and profits for the company, has a tendency to not only consistently draw new sources of spending but retain buyers once they're on the platform. Case in point: As of Q2 2023, habitual buyers account for roughly 43% of all gross merchandise sales processed on the Etsy platform.  

Habitual buyers are individuals who have shopped on Etsy for six or more days and spent at least $200 on the platform in the prior 12 months. Etsy also reported that its cohort of habitual buyers was up 218% in Q2 2023 compared to the same quarter in 2019. While consumer spending will take time to recover, these buyer patterns and the steady growth in merchants onboarded to Etsy hold promise for the future and for faithful shareholders.  

An investment of $1,000 in Etsy at its current trading price would result in about 14 shares purchased.