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3 Growth Stocks That’ll Make You Richer in April (and Beyond)

April 06
10:44 2021

Back in 2016, a report from Bank of America/Merrill Lynch found that, between 1926 and 2015, value stocks outperformed growth stocks by an annualized average of 4.4 percentage points over 90 years (17% vs. 12.6%). However, it’s been a different story since the end of the Great Recession in early 2009.

With the Federal Reserve coercing lending rates to historic lows, fast-growing companies have been able to borrow at cheap rates. The ability to hire, innovative, and acquire other businesses with ease is precisely why growth stocks have been such a perfect investment over the past decade.

The thing about growth stocks is that value can always be found, if you’re willing to do some digging and be patient. The following three growth stocks all have the tools to make investors richer in April, and well beyond.

Okta

One of the smartest ways to take advantage of the recent pullback in growth stocks would be to snatch up shares of cybersecurity company Okta (NASDAQ:OKTA) at a discount. Shares the company, which focuses on cloud-based identity verification, have declined by 21% since hitting an all-time high in February.

Though there are no shortage of trends and industries that offer double-digit growth potential this decade, cybersecurity is arguably the safest bet for investor success. More businesses than ever have created an online presence and moved their data into the cloud, which means the onus of protecting this data has increasingly fallen on third-party providers. In other words, cybersecurity has become a basic-need service, which means not even once-in-a-generation recessions can slow down the industry’s momentum.

What makes Okta such an intriguing company is its suite of cloud-native identity solutions. Okta’s services lean on artificial intelligence to grow smarter at identifying potential threats, and being built in the cloud allows for a quicker response time than on-premises security solutions.

Additionally, Okta’s portfolio of security solutions isn’t a one-size-fits-all for businesses. It’s designed to scale along with its clients over time. Since 96% of its revenue (as of the fourth quarter) is derived from high-margin subscriptions, retaining and scaling with existing customers is what’ll help drive operating cash flow significantly higher.

Continue Reading at The Motley Fool

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