The economic downturn of 2022 was difficult for many businesses and investors. However, as the second month of 2023 approaches its mid-days, there are signs that the downturn may finally be easing.
The easing of the downturn has investors excited about the potential of a bull cycle. A bull market is a monetary market characterized by a general price rise over a sustained period. This rise in prices creates a sense of optimism and attracts more investment, further driving up the prices of assets.
Bull markets usually follow a bearish cycle, which lasts for about a year. So, is it too late to invest in these growth stocks that the downturn battered? The answer is no, as these stocks still have the potential for growth and profitability. The key is researching, identifying the best opportunities, and investing wisely.
Investors Against Growth Stocks
Despite the trend towards defensive stocks, some investors still believe in the potential of growth stocks. After all, a bull market can bring huge returns for those who invest in the right companies at the right time.
Moreover, some experts point out that growth stocks have outperformed defensive stocks in the past, especially during periods of economic expansion. While the economy may have slowed down in the past year, it is finally showing signs of recovery.
As the second month of the year approaches its midpoint, investors closely monitor the stock market to see which stocks are worth investing in as assets. Many are looking to take advantage of the recent economic upturn and are hoping to identify the next big growth stock before it becomes mainstream.
However, growth stocks can be high-risk, high-reward investments and may not be suitable for everyone. It all comes down to personal preference & investment goals. So now is a good time to assess your portfolio and determine whether growth is appropriate for you.
Standout Growth Stocks
As investors start to show more interest in growth stocks, it’s important to take a closer look at some of the standout performers in the market. Tesla has been a standout performer, with a record high revenue and net income, despite the economic downturn.
However, the stock is trading at 50 times forward earnings predictions, down from over 80 in 2022. On the other hand, Amazon, which has been grappling with supply chain issues and high costs, is trading at its lowest compared to the 2016 highs.
However, the company is taking the necessary steps to remain a leader in the industry and cloud services. Teladoc, a leader in virtual health care, is trading at its lowest, down 4.5% in 2023, due to reporting goodwill impairment charges from an acquisition. But the company has been narrowing its losses by winning over new members, with sales and virtual visits skyrocketing.