Inclusion in the Robinhood 100 list means that a stock is popular, but popular stocks do not always perform well. However, there are certain stocks on the list currently that have performed well this year and look poised for significant gains in 2021 also.
PayPal Holdings, Inc. (PYPL), Pfizer, Inc. (PFE), Starbucks Corporation (SBUX), Square, Inc. (SQ) are four such stocks that are ready to enter 2021 with strength and promise. These companies delivered better-than-expected performance numbers in their last quarterly reports and are well positioned to keep showing improvements in the upcoming quarters.
These stocks do have strong fundamentals and their business models are succeeding even amid current economic uncertainty. These companies are seeing high demand for their products and services, which we expect will continue.
PayPal Holdings, Inc. (PYPL)
PYPL operates a platform that allows users to transfer money in the US and internationally. The platform facilitates both digital and mobile payments. PYPL’s stock has gained 100.5% so far this year.
PYPL’s remittance company XOOM recently announced that users in the United States will now be able to send money directly to a recipient’s bank account. Recipients will be able to receive the money without having to sign up for an account with XOOM. The move comes at an opportune time during the pandemic, allowing users to send money to their loved ones entirely online.
For the quarter ended September 2020, the company’s total payment volume rose 38% compared to the same period last year. The company also saw an addition of 15.2 million Net New Active Accounts to its service.
PYPL is expected to see revenue growth of 13.2% for the quarter ended February 2021 and 15.4% in 2021. The company’s EPS is estimated to grow 12.4% in 2021 and at a rate of 17.4% per annum over the next five years.
How does PYPL stack up for the POWR Ratings?
A for Trade Grade
A for Buy & Hold Grade
A for Peer Grade
A for Industry Rank
A for Overall POWR Rating
The stock is also ranked #2 out of 46 stocks in the Consumer Financial Services industry.
Pfizer, Inc. (PFE)
PFE develops, manufactures, and markets pharmaceutical and healthcare products. The company’s brands include Celebrex, Lipitor, Viagra, Zyvox, Sutent, EpiPen, and more. PFE’s stock has risen 14.5% year-to-date.
PFE is responsible for the first clinically proven and government approved coronavirus vaccine in the world. This development is likely to lead to significant gains for the company in the coming months. Pfizer also has several other drugs in the pipeline. The US FDA has recently approved for Priority Review the application by PFE for a license to market a 20-valent pneumococcal conjugate vaccine for the prevention of invasive diseases in adults.
For the quarter ended September 2020, the company saw year-over-year operational revenue growth of 4% in biopharma. The company projects a CAGR for revenue of at least 6% through 2025.
PFE’s revenue is estimated to increase 7.2% in 2021. Its EPS is expected to rise 5.6% in 2021.
PFE’s strong fundamentals are reflected in its POWR Ratings. It has a “Strong Buy” rating with an “A” for Trade Grade, Buy & Hold Grade, Peer Grade, and Industry Rank. It is ranked #2 of 240 stocks in the Medical – Pharmaceuticals industry.
Starbucks Corporation (SBUX)
SBUX operates as a roaster and retailer of specialty coffee, tea, and other beverages. The company operates worldwide. SBUX’s stock price has increased 30.2% year-to-date.
SBUX is preparing for the holiday season and has released a line of collectible holiday cups. New holiday beverages and merchandise are also available across Starbucks Reserve locations in the United States. The company has also announced the rollout of new straw less lids for its cups across the United States and Canada.
For the quarter ended September 2020, SBUX opened 480 net new stores, representing a net annual growth of 4%. The average ticket size increased 21% in the Americas versus the same period last year.
SBUX’s revenue is expected to grow 11.5% for the quarter ended March 2021 and 21.2% in 2021. The company’s EPS growth is expected to be 16.7% in 2021 and 46.6% per annum over the next five years.
It is no surprise that SBUX has a “Strong Buy” in our POWR Ratings systems with a grade of “A” in Trade Grade, Buy & Hold Grade, and Peer Grade. In the 49-stock Restaurants industry, SBUX is ranked #1
Square, Inc. (SQ)
SQ develops and markets a point-of-sale software globally. The company’s software helps merchants administer billing, receipts, inventory, and other point-of-sale related operations. SQ’s stock has gained 240.5% year-to-date.
SQ has partnered with DoorDash Drive to enable Square Online users to make deliveries using DoorDash’s network of Dashers. This partnership will help improve the on-demand delivery feature of Square Online. SQ has also entered into an agreement to acquire Credit Karma Tax, which provides a tax-filing service.
For the quarter ended September 2020, the company reported an increase in gross profit of 59% year-over-year. The number of daily active users on the Cash App nearly doubled from the same period last year.
SQ’s revenue growth is expected to be 109.4% for the quarter ended March 2021 and 37.4% in 2021. The company’s EPS growth is expected to be 45.5% in 2021 and 38% per annum over the next five years.
SQ’s strong fundamentals are reflected in its POWR Ratings. It has a “Strong Buy” rating with an “A” for Trade Grade, Buy & Hold Grade, and Peer Grade. It is ranked #1 of 236 stocks in the Financial Services (Enterprise) industry.
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PYPL shares were trading at $217.47 per share on Wednesday afternoon, up $0.53 (+0.24%). Year-to-date, PYPL has gained 101.04%, versus a 16.42% 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...
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