Investing in cryptocurrency can offer a promising opportunity for those with a substantial risk appetite, potentially bringing profitable outcomes to your personal investment portfolio. However, diversifying your investments doesn't necessitate venturing into the realm of digital assets. Exceptional companies can be found in any market, even amidst the turbulence witnessed in recent years. Investors who have persevered through market fluctuations have encountered this reality frequently.
If you're in search of outstanding stocks to enhance your portfolio in the upcoming weeks, be sure not to disregard these three options when making your investment decisions.
1-Airbnb
(NASDAQ: ABNB) has consistently impressed investors with its robust financial performance, demonstrating resilience in what could be perceived as a challenging operational landscape. Despite economic constraints on consumer spending compared to previous years, people are still allocating funds for experiences, even amid escalating travel costs and geopolitical uncertainties. While various companies stand to gain from these trends, Airbnb's platform stands out by offering a diverse array of options catering to all kinds of travelers and budgets.
This distinctive feature likely plays a pivotal role in Airbnb's sustained growth across diverse market conditions. Whether individuals seek short- or long-term accommodations, an entire residence, or just a room, Airbnb provides choices across numerous countries, all with minimal overhead expenses for the business as it doesn't own or manage the properties listed on its platform.
The company has consistently expanded its efforts to capture spending across different traveler profiles and needs. These initiatives include increased discounts for extended stays, new accommodation options starting at an average nightly rate of $67, enhanced search filters for guests, pricing tools for hosts, and additional benefits for both hosts and guests.
In the third quarter, active listings on the platform surged by 19% compared to the previous year, with guests spending $18 billion in gross booking value—an increase of 17% from the same period last year and 89% more than four years ago. Profits for the quarter reached $4.4 billion, while the trailing 12-month free cash flow amounted to $4.2 billion. With robust financials aligning with its solid business model, investors may consider seizing the opportunity now to capitalize on Airbnb's growth narrative in the coming years.
2- Vertex Pharmaceuticals
(NASDAQ: VRTX) continues to thrive, driven by its leading portfolio of cystic fibrosis drugs, a promising pipeline targeting rare diseases, and imminent approvals. As of the current writing, it stands out as the sole provider of market-approved drugs addressing the root cause of cystic fibrosis, a genetic disorder affecting approximately 160,000 individuals globally.
Moreover, Vertex recently secured approval for the world's inaugural CRISPR-based medication, Casgevy, designed in collaboration with CRISPR Therapeutics. This groundbreaking gene-editing therapy offers a one-time functional cure for both sickle cell disease (SCD) and transfusion-dependent beta-thalassemia (TDT) across multiple countries, including the U.S. Although initial approvals pertain to specific patient cohorts, such as around 16,000 eligible individuals for SCD and approximately 1,000 for TDT, the vast market potential remains evident. In the U.S. alone, there are roughly 100,000 individuals with SCD, indicating a substantial market opportunity.
It's important to note that realizing the financial impact of these approvals will be a gradual process due to the intricate and time-consuming nature of preparing patients and administering the therapy. The procedure involves obtaining and editing the patient's own blood stem cells before reintroducing them.
Looking ahead, Vertex's forthcoming milestone could involve the approval of its non-opioid drug candidate for acute pain, demonstrated as safe and effective in both surgical and nonsurgical settings through clinical studies. The regulatory paperwork for this candidate is anticipated to be submitted in the upcoming months. In the interim, Vertex boasts a robust financial track record, with its core products generating billions in annual profits and cash flow, providing a positive outlook for long-term investors.
3- Chewy
(NYSE: CHWY) has faced a challenging period, witnessing a significant decline of over 60% in its stock value compared to a year ago, which has raised concerns among certain investors. The factors contributing to this downturn include mixed sentiments among investors regarding growth stocks, apprehensions about pet-related expenditures amid economic uncertainties, fluctuating profitability, and relatively cautious near-term guidance.
However, despite these challenges, Chewy's management remains optimistic about the company's ability to enhance its market share and capitalize on consumer spending trends. This perspective appears reasonable considering the overall growth trajectory of the business, the diverse range of segments within which Chewy operates, and the inherent resilience of the pet industry.
While consumer spending may experience fluctuations in challenging economic environments, pet-related expenses are often viewed as essential for most households. Chewy predominantly generates revenue from recurring sales rather than one-time purchases by pet owners. Notably, 76% of the company's net sales are attributed to its Autoship program, enabling customers to establish recurring product shipments. Autoship sales demonstrated a robust 13% year-over-year increase in the third quarter of 2023.
Furthermore, a substantial 85% of Chewy's net sales in the recent quarter originated from non-discretionary and health-related spending by pet owners. This means that consumers continue to allocate funds for essential pet products, and Chewy's growth is primarily driven by such necessary spending rather than discretionary pet purchases. The company reported net sales of $8.3 billion in the first nine months of 2023, accompanied by a trailing 12-month cash flow of $300 million as of the end of the third quarter.
