10 Growth Stocks For 2021

Hello Everyone!

Thank you first and foremost for subscribing to my newsletter. I have been brainstorming for a while now and getting some feedback from many of you on what you want to see most in my newsletter. Prior versions of my newsletter where jam packed with market info, watchlist, stocks in the spotlight, portfolio updates, etc. However, moving forward, I will be providing a monthly newsletter, broken into various parts:

-          10 Growth Stocks At Reasonable Valuations

-          10 Dividend Stocks At Reasonable Valuations

-          10 REITs At Reasonable Valuations

In each part I will disclose 10 stocks I feel are trading at reasonable valuations at that moment in time. Again, these are my opinions and not to be intended as investment advice.

As such, let’s look at 10 Growth Stocks I like for 2021.

Disclaimer:  The stocks mentioned below are not intended to be a list of buy ratings. Stocks can sometimes move in a volatile fashion, so it is important to first perform your own due diligence or contact your financial advisor. Each investor has their own goals and risk appetite, which should be considered prior to investing. 

10 Growth Stocks For 2021

1. Alphabet Inc. (GOOGL)

Stock Price: $1,734.16

Market Cap: $1.2 Trillion

YTD Performance: 29.5%

2021 Estimated Sales: $216.9 Billion

Advertising revenues for Alphabet took a dip in 2020, but I am expecting a rebound in 2021 as companies reinvent and look for more ways to utilize their advertising budget. Over 70% of Alphabet’s advertising revenue comes from Google Search. Included in the Advertising revenue pie is YouTube, which accounts for roughly 15% of advertising revenue. YouTube remains a major bright sport for the company. Advertising accounts for 80% of Alphabet’s total revenue. Comps should be easy to overcome in 2021 and the environment should be different from the challenging 2020 we saw.

2. Alibaba Group Holding Limited (BABA)

Stock Price: $222.00

Market Cap: $600.7 Billion

YTD Performance: 4.7%

2021 Estimated Sales: $140.7 Billion

Alibaba is actually one of my favorite stocks for 2021. The Chinese economy continues to recover and grow at a stronger clip than the US economy, and BABA is a giant overseas. The company is currently being pressured by the Chinese government in an anti-monopoly probe. The impact seems way over blown and a great opportunity for long-term investors to gain exposure to the Chinese economy. Alibaba is a play on e-commerce, cloud, retail, food delivery and much more. Alibaba has their hands in many different industries. I have often heard many compare BABA to AMZN, except BABA is trading at a MUCH lower valuation.

3. CrowdStrike Holdings, Inc. (CRWD)

Stock Price: $221.12

Market Cap: $48.9 Billion

YTD Performance: 343.3%

2021 Estimated Sales: $859.2 Million

CRWD was my top performing stock in 2020 (still have a few days left), and the old saying is to “let the winners run.” That is not the primary reason CRWD made my 2021 list, instead it is due to the continued growth I see in the cybersecurity industry. As more and more companies were forced to go remote, it will be a form of working that will be permanent for many businesses moving forward, which further heightens the cybersecurity risk. The cloud security market is expected to grow 10x to more than $12 billion in the next 3 years. The Total Addressable Market (TAM) the company operates in as a whole is expected to be near $40 billion in 2023. The company is riding high, but with the growth in the industry I see shares of CRWD reaping the benefits and continuing to grow over the next few years.

4. Mohawk Group Holdings, Inc. (MWK)

Stock Price: $16.69

Market Cap: $325.5 Million

YTD Performance: 183.4%

2021 Estimated Sales: $298.1 Million

MWK is a small-cap conviction buy on my watchlist list for 2021. MWK is a lesser known name compared to others on my list for 2021. The company is focused on e-commerce, but with AI powered. Not only do they have their own e-commerce platform, but they also use AI to sell products on other e-commerce platforms like AMZN and SHOP. The power of AI allows for review of numerous products and reviews to locate product trends. The company is expecting strong growth in 2021 especially as e-commerce continues to climb higher.

5. Pershing Square Tontine Holdings, Ltd. (PSTH)

Stock Price: $26.03

Market Cap: $42.2 Million

YTD Performance: 21%

2021 Estimated Sales: N/A

It is 2020, I could not have a top 10 list of growth stocks without including at least one SPAC. SPAC’s have become ultra-popular this year and we have seen some major success stories with quite a few of late, which has only increased the buzz around them. SPACs are also known as “blank check” companies that look to acquire private companies and bring them public. Investing in a SPAC means you are essentially investing in the management team and trusting that they will make a high-quality acquisition. PSTH as a great management team led by Bill Ackman.

6. Rapid7, Inc. (RPD)

Stock Price: $89.28

Market Cap: $4.6 Billion

YTD Performance: 59.4%

2021 Estimated Sales: $483.7 Million

I already mentioned my bullish take on the cybersecurity industry above, so see the CRWD summary for that. RPD is a MUCH smaller cybersecurity company that is growing at a strong clip. The company uses a SaaS model and I expect growth to continue moving forward or a possible acquisition.

7. Redfin Corporation (RDFN)

Stock Price: $78.05

Market Cap: $8.0 Billion

YTD Performance: 269.2%

2021 Estimated Sales: $1.3 Billion

Redfin has been on quite a run of late, having gained over 70% in the past month! Unfortunately, I have been wanting to add the name to my portfolio, but missed grabbing it at a lower valuation. That is unfortunate, but I truly believe this name is a disruptor in the Real Estate space. We are already seeing cars start to be purchased online, homes are continuing to gain traction, plus you can sell your property for MUCH lower realtor fees by using RDFN. Redfin is supposed to be close to turning a profit in 2021 based on average analyst expectations, but I believe the company will in fact turn a profit in ’21. The Fed has already stated they will be keep rates low through ’23, and the Real Estate market is expected to remain hot through next year, as demand currently far outweighs supply.

8. Sea Limited (SE)

Stock Price: $193.18

Market Cap: $98.8 Billion

YTD Performance: 380.3%

2021 Estimated Sales: $7.7 Billion

Sea Limited is yet another stock with exposure to the growth in China, similar to why I like BABA. Unlike BABA, SE does not get the same amount of press, but they are similar in the fact they have their arms in various different buckets primed for extreme growth in the next 12 months and beyond. The company has exposure to online gaming, e-commerce, and digital payment, all of which are growing at rapid rates and should continue in 2021. The stock does not trade at a cheap valuation by any means, but I believe it to be justified based on the expected future growth. Gaming is a hot sector in the region and e-commerce is still in the infantry stages, therefore, I have high expectations for the company moving forward.

9. Square, Inc. (SQ)

Stock Price: $228.28

Market Cap: $102.9 Billion

YTD Performance: 264.9%

2021 Estimated Sales: $13.0 Billion

Continuing on with the digital payment theme from SE, this leads us to my next stock that I like, Square. The company has transformed the digital payment industry for small businesses along with competitor PYPL. The company is led by CEO Jack Dorsey, who is also the CEO of TWTR. This is one negative I see. Although Mr. Dorsey has a very creative and forward looking mind, I am under the impression that a CEO job for a fast growing company is more than a full time job, let alone leading two public companies. Square owns CashApp, which has become a popular route for new cryptocurrency investors to buy Bitcoin. I recently signed up for CashApp myself to begin adding some Bitcoin to my portfolio. Owning SQ is like owning Bitcoin in a way. Fintech is in the early innings and SQ is setup to continue benefiting from the growth in the space.

10. Teladoc Health, Inc. (TDOC)

Stock Price: $207.95

Market Cap: $30.1 Billion

YTD Performance: 148.4%

2021 Estimated Sales: $2.0 Billion

Healthcare is a sector that has largely not yet been disrupted by technology until now. TDOC is the disruption to the old ways of healthcare. They are the leader in the space (regardless of AMZN attempting to enter) and will look to grow their footprint. Telehealth was growing prior to COVID, but the pandemic provided a huge jolt for the company, however, I am of the belief that the trend will continue post pandemic. The world we live in today is all about speed. No longer do you have to go to the doctor’s office, wait in the waiting room for 45 min, instead, you can setup an appointment or call as needed to talk with a doctor. TDOC closed its merger with Livongo, which will be a huge boost moving forward based on the AI that comes with LVGO. As the TDOC CEO put it, this is “a new kind of healthcare experience.” The digital health market is expected to reach over $500 billion by 2025, so the TAM is quite large for the company.

Stay tuned for my 10 Dividend Stocks and 10 REITs for 2021 to drop in the coming days. Let me hear from you on the Newsletter format and other feedback on what you would like to see in future Newsletters. Contacting me on Twitter (@Dividend_Dollar) and drop me a DM.

Stay safe and happy investing!

Disclaimer: I currently have positions in GOOGL, BABA, CRWD, TDOC. I will be looking to add the others to my portfolio soon.