The Robinhood stock investing and trading platform runs a list of the 100 most popular stocks on its website. These stocks tend to be more popular with millennials and younger investors who are ready to bet on stocks based on market hype, and sometimes irrespective of fundamental strength. So, the list includes stocks that have attracted the attention of millennial investors for a reason.
But what can be better than relying on what is both popular and fundamentally sound when there are uncertainties in the market. To that end, it could be a good idea to bet on Robinhood stocks that have fundamental strength and a solid history of growth.
Microsoft Corporation (MSFT), PayPal Holdings, Inc. (PYPL), Nike, Inc. (NKE), and Peloton Interactive, Inc. (PTON) are four such stocks that have been continuously upgrading their offerings to capitalize on the ongoing crisis and could soar in the coming months.
Microsoft Corporation (MSFT)
MSFT develops and licenses software products including the ubiquitous Windows operating system. The company also provides cloud computing services through Microsoft Azure along with developing and marketing the Xbox series of gaming consoles. MSFT’s stock has gained 41.6% so far this year.
The company is going to release the latest instalment in its Xbox gaming console line, called Xbox Series X. The company’s forays into the gaming sector have been largely successful, and the new Xbox will help MSFT solidify its position. The company has also been working to improve its Microsoft Teams software, which will help remote learners and remote workers collaborate and work. The new update to the software will display live captions so that it is easier to communicate through the software.
During the quarter that ended September 2020, the company saw an increase in revenue of 12% compared to the same period last year. The company’s operating income rose 25% year-over-year. The company’s cloud services has been the biggest driver of growth and MSFT saw 31% more revenue coming from that segment.
MSFT is estimated to see revenue growth of 8.9% for the quarter ending December 2020, and 10.7% in 2021. The company’s EPS is expected to rise 17.5% in 2021 and at a rate of 14.5% per annum for the next five years.
How does MSFT stack up for the POWR Ratings?
B for Trade Grade
B for Buy & Hold Grade
B for Peer Grade
B for Industry Rank
B for Overall POWR Rating
The stock is also ranked #8 out of 96 stocks in the Software – Application industry.
PayPal Holdings, Inc. (PYPL)
PYPL facilitates mobile and digital payments through its technology platform. The company is one of the most popular choices for facilitating international payments. The company charges a percentage of the transaction volume as fee. PYPL’s stock has gained 89.1% so far this year.
The company has recently announced that it will allow users to buy, hold, and sell cryptocurrencies directly through its platform. With the growing popularity of cryptocurrency trading and holding, this new feature may supercharge growth for the company. The company has also invested $50 million in venture capital funds led by black and latinx individuals.
The growing adoption of digital payments has proved to be a boon for PYPL during the quarter that ended September 2020. The volume of digital payments made through the platform increased 38% on a FX-neutral basis. The platform also added 15.2 million net new active accounts.
PYPL is expected to witness revenue growth of 22.7% for the quarter ending December 2020, and 19% in 2021. The company’s EPS is estimated to grow 19.8% in 2021 and at a rate of 23% per annum over the next five years.
It’s no surprise that PYPL is rated a “Buy” in our POWR Ratings system, with a grade of “A” in Trade Grade and Peer Grade. In the 46-stock Consumer Financial Services industry, it is ranked #2.
Nike, Inc. (NKE)
NKE is one of the world’s leaders in athletic apparels and footwear. The company develops, manufactures, and markets athletic apparel for men, women, and kids worldwide. The company also acts as a sponsor to major sporting events and teams globally. NKE’s stock has gained 28% so far this year.
The company has recently launched a slew of new products including a new apparel line named Every Stitch Considered and a Nike x sacai shoe collection. The company has also collaborated with Seoul-born hip hop star G-Dragon and will release the Nike Air Force 1 “para-noise” shoe collection on November 25th worldwide.
NKE saw a decrease in footfall across its stores globally due to safety measures to fight the coronavirus during the quarter that ended September 2020. However, digital sales for the company were up 82% on a reported basis. Sales from Nike Direct were also up 12%.
NKE is expected to witness revenue growth of 2.3% for the quarter ending November 2020, and 12.2% in 2021. The company’s EPS is estimated to grow 79.4% in 2021 and at a rate of 25.14% per annum over the next five years.
NKE’s strong fundamentals are reflected in its POWR Ratings. It has a “Buy” rating with an “A” in Trade Grade, Peer Grade, and Industry Rank. In the 34-stock Athletics & Recreation industry, it is ranked #3.
Peloton Interactive, Inc. (PTON)
PTON operates an interactive fitness platform. It also engages in in-studio fitness classes, at-home fitness equipment, fitness clubs, and fitness and wellness apps. The company makes its revenue through subscription-based services and the sale of products through multiple channels. PTON’s stock has gained 345.9% so far this year.
The company is reportedly working on a new Peloton treadmill equipment and low-cost bike equipment. These new additions to Peloton’s portfolio would be welcome to the company’s many fans who want more from the company. The company has been experiencing a surge of demand, even though it is struggling to meet the demand due to supply chain constraints.
During the quarter that ended September 2020, Peloton’s connected fitness subscriptions grew 137%, and paid digital subscriptions grew 382%. The total revenue for the quarter increased 232%. PTON is expected to witness revenue growth of 98.8% in 2021 and 34.6% in 2022. The company’s EPS is estimated to grow 137.5% in 2021 and 258.3% in 2022.
It’s no surprise that PTON is rated a “Buy” in our POWR Ratings system, with a grade of “A” in Industry Rank, and a “B” in Trade Grade and Peer Grade. In the 34-stock Consumer Goods industry, it is ranked #5.
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MSFT shares were trading at $223.12 per share on Friday afternoon, down $0.17 (-0.08%). Year-to-date, MSFT has gained 42.61%, versus a 10.22% rise in the benchmark S&P 500 index during the same period.
About the Author: Aaryaman Aashind
Aaryaman is an accomplished journalist that’s passionate about providing in-depth insights about investing and personal finance. Recently he has been focused on the stock market and he specializes in evaluating high-growth stocks. More...
More Resources for the Stocks in this Article
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|PTON||Get Rating||Get Rating||Get Rating|