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As the name suggests, growth stocks are judged on their ability to deliver large returns. Those who do it consistently, year after year, are often rewarded with a much higher share price.
Here, I’ll look at growth stocks in the US index that have been trending upward for years. But in the fourth quarter of 2024, they regained business and were duly rewarded with an increased price.
Looking at their high competitive positions today, I think both are set up to continue beating the market in the long term. I feel both are worth further research.
Precise surgery
The first is a robotic-assisted surgical pioneer Precise surgery (NASDAQ: ISRG).
The stock was already up more than 150% in the five years prior to January 15 when the company released its Q4 trading update. However, the market is happy to add another 12% after Accurate said it expects a higher growth of 25% (about $2.41bn) rather than Wall Street’s 14%.
This surprise came after placing 493 DA Vinci Shteel surgical robots during the quarter, including 174 of the latest DA Vinci 5 robots. This next generation has 10,000 times the computing power of its predecessor!
In the full year, accurate placed 1,526 da Vinci systems, an increase of 11%, which gets its total base to 10,000. It also expects full-year revenue of around $8.35bn, a 17% increase.
This is encouraging for shareholders because of the razor-and-blades business model. IT surgical robots exist, the rest you get from selling the tools and other equipment needed to run them. Most of the company’s capital is multiplied.
Another big danger here would be another epidemic. In the last period, the company’s income has decreased significantly as operations have been delayed or canceled. Also, trading at 78 times the lead, this high-quality stock is far from cheap.
However, the company remains a global leader in the robotic repair space, and the long-term future continues to look very bright.
TSMC
Second company released Blowout Q4 numbers Taiwan semiconductor manufacturing (NYSE: TSM). The stock is up 9% since the chipmaking giant reported $26.9bn in cash flow (up 38%) and a 57% increase in profits ($11bn). Both figures beat Wall Street’s expectations.
Many technology firms outsource their chip manufacturing to TSMC, including an apple, Invidi, Advanced small devices, -Omumvamoagain Holding an arm. And custom AI chips are really driving growth, with revenue from Artificial Intelligence (AI) accelerators over 2024.
Income now predicts money will grow at five-year annual growth rates (cagr) of 20%!
One challenge would be an unexpected drop in spending, especially in some of TSMC’s currently weak markets (core smartphones and electric vehicles). It’s really the insane growth of AI that removes this weakness.
As for the starting price, PROPROR SATURIO averages 25
If you look ahead, the demand for semiconductors is likely to increase only as megatrends such as AI, cloud computing, electric vehicles, electric cars play out. TSMC is perfectly positioned to benefit as the chip manufacturer of choice for many blue-chip firms.
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