2023 was a comeback year for most growth stocks as they rebounded, led largely by big names in tech. Growth stocks can build you a fortune if chosen right, and a new year is a perfect time to evaluate your investments and add some stocks to your portfolio. Salesforce (CRM 0.42%), Albemarle (ALB 1.65%), and Symbotic (SYM 1.62%) are three such incredible growth stocks that are screaming buys for 2024 right now. Here's why.
1. Albemarle: A no-brainer, beaten-down growth stock
You wouldn't expect a commodity stock to make it to a list of growth stocks, but Albemarle is an exception. The lithium stock was hammered in 2023 as lithium prices plunged on fears of a slowdown in demand for electric vehicle (EV) batteries. Although Albemarle also sells bromine and specialty chemicals, it is the world's largest lithium producer and relies heavily on lithium for growth. The stock, however, is a no-brainer buy for 2024 and beyond at its current price.
Albemarle stock is currently trading at a price-to-earnings (P/E) ratio of only 5 times and a price to cash flow of only around 7 times. It also pays a dividend that has increased every year for 28 consecutive years. Further, Albemarle's top line is still growing despite falling lithium prices -- it expects to grow sales by at least 30% in 2023, led by higher volumes under long-term contracts.
Driven by capacity expansions, Albemarle still expects sales volumes to grow at a compound annual growth rate of 20% to 30% in 2024 and beyond, despite the market's fears of falling demand for lithium. By 2027, the company expects to nearly triple its volumes.
Albemarle is also still keen to pursue acquisitions after walking out on its $4 billion deal for Australia's Liontown Resources in 2023 because of complexities. Albemarle has a strong balance sheet and cash position, so making opportunistic acquisitions in a down lithium market should prove to be a smart move.
Albemarle has unbeatable clout in the lithium market, and demand for the element should only rise as more EVs replace gas-guzzling cars globally. With Albemarle still projecting double-digit sales growth for 2023 and 2024, now is a great time to buy the growth stock while it's still languishing.
2. Salesforce: 2024 could be a big year for this growth stock
For a decade now, Salesforce has dominated the global customer relationship market (CRM) in terms of revenue. The CRM software solutions giant has grown at a torrid pace in recent years, nearly tripling its revenue in just the past five years. Salesforce generated $31.4 billion in revenue in the financial year that ended Jan 31, 2023, and converted nearly 20% of its revenue into free cash flow.
Salesforce management has relentlessly focused on restructuring the business to boost productivity and profitability over the past year or so. Its efforts are already showing up in the numbers. Salesforce is on track to deliver double-digit revenue growth, earn an operating margin of around 14%, and generate record cash flows for the ongoing financial year ending Jan. 31, 2024.
Demand for most of Salesforce's products, including MuleSoft, Tableau, and Slack, remains strong. Importantly, Salesforce is diving deep into artificial intelligence (AI) with products like Data Cloud and believes AI could be a game-changer for the company going forward.
With its remaining performance obligations (RPO) jumping 21% year over year in the third quarter to $48.3 billion, Salesforce is entering fiscal year 2025 on a solid note. RPO denotes contracted revenue, which could convert into actual revenue and is, therefore, an important gauge of Salesforce's revenue potential.
2023 was a transformative year for Salesforce, one that should set the pace for bigger things to come at the company. That makes Salesforce an incredibly compelling growth stock to buy for 2024.
3. Symbotic: Sales are booming for this young growth stock
2023 was a massive year for Symbotic. The company sells AI-powered warehouse automation systems with supporting software and maintenance services under long-term contracts. And demand for its products and services is rising steadily. Symbotic's revenue surged 98% to $1.8 billion in the fiscal year that ended Sept. 30, 2023.
Most importantly, Symbotic ended last fiscal year with a massive backlog of $23 billion. That includes a backlog of $11 billion from its joint venture, GreenBox, with Japanese multinational company Softbank Group. Symbotic owns a 35% stake in the six-year venture and expects to generate $500 million in annual revenue with high margins once it completes installing all systems and software for GreenBox.
From that standpoint, 2024 should be a big year for Symbotic as it starts generating systems revenue from GreenBox. The venture will also add a new source of revenue -- warehouse-as-a-service -- for Symbotic and could, therefore, open up massive opportunities for the company in the coming years.
GreenBox also aligns with Symbotic's new strategy of reducing reliance on manufacturing and opting to outsource manufacturing and systems installations while management focuses on innovation and product development. The move should not only cut costs but also help Symbotic deploy systems faster at customers' ends and, therefore, boost revenue. Symbotic already boasts some big names among its customers, including retail giants Walmart, Target, and Albertsons.
With Symbotic projecting at least 70% year-over-year revenue growth for the first quarter of fiscal year 2024, this is one growth stock you'd want to buy hand over fist for 2024.
