Uncovering Growth Opportunities: Amazon’s Ascent and Celsius’s Rebound in a High Market

This article explores investment opportunities in two growth stocks: Amazon, which continues to thrive near all-time highs with potential for further expansion, and Celsius, an energy drink brand rebounding from a significant stock decline, offering promising market share growth. It emphasizes the importance of strategic investment choices even when the market is at historical peaks.
SummaryThe stock market, comprised of numerous individual companies, always presents opportunities for discerning investors, even at market highs. This article highlights two growth stocks available at compelling prices. Amazon, an e-commerce and cloud giant, is trading near all-time highs but still offers significant growth potential due to its dominance in online retail and cloud services. Conversely, Celsius, an emerging energy drink brand, has seen a 65% stock decline yet continues to capture market share and offers promising growth prospects. Investors are encouraged to consider these opportunities carefully, with a nod to Motley Fool’s Stock Advisor, which provides guidance on top stock picks, excluding Amazon, for potential future gains.

Navigating the Stock Market: Finding Value Beyond All-Time Highs

The stock market, often perceived as a singular entity, is actually a vast assemblage of individual companies, each with its own unique narrative. Consequently, even when the market as a whole hovers near record highs, not all stocks come with a hefty price tag. It’s more accurate to describe Wall Street not as a singular stock market, but as a market of stocks. This means there are always opportunities if you know where to look.

Below, we explore two growth stocks currently trading at enticing prices. One is near its all-time high, while the other has seen a significant decline of 65% from its peak. Remarkably, you can invest in both for under $500 today. Here’s a closer look at each.

1. E-Commerce Titan Nearing New Heights

Amazon (0.91%), a behemoth in e-commerce and cloud computing, has consistently been a rewarding investment. Despite its staggering market capitalization nearing $2 trillion, Amazon still promises substantial growth potential. It dominates the U.S. online retail space with a 38% market share and leads globally in cloud services with a 31% share. Yet, opportunities for expansion remain. E-commerce accounts for only 16% of total U.S. retail, and Amazon has significant room for growth in underdeveloped sectors like groceries and pharmaceuticals. Additionally, the global shift towards digitalization and artificial intelligence (AI) is expected to bolster the cloud market further.

Analysts predict Amazon’s earnings could grow by an average of 27% annually over the next three to five years. Currently, Amazon’s stock is priced at 39 times its estimated earnings for 2024. This forward price-to-earnings ratio is appealing for a company with such a rapid growth trajectory. When evaluating Amazon based on its operating cash flow—which provides insight into its profitability before reinvestment—the valuation is near a decade low.

While Amazon’s stock is close to its all-time highs, there remains a compelling case for long-term investors to acquire a stake in this exceptional company at a comparatively attractive price.

2. Energy Drink Contender on the Rebound

Celsius (-2.64%), a rising star in the energy drink sector, has positioned itself as a formidable competitor to the well-established Monster brand. Over the past five years, Celsius has surged in popularity, achieving more than 6,000% returns at its peak. However, the stock has since plummeted by 65%, prompting investors to reevaluate its potential for a resurgence.

Celsius experienced explosive growth during the pandemic, further accelerated by a strategic investment from PepsiCo, which expanded its distribution network. Yet, as the pandemic’s impact waned, so did Celsius’s growth momentum, leading to a slowdown in revenue and subsequent stock struggles.

Despite these challenges, Celsius continues to capture market share, with a year-over-year sales increase of 23% in the second quarter, outpacing the industry’s low single-digit growth. The company remains highly profitable, with analysts forecasting an average annual earnings growth of 16% over the next three to five years.

Currently, Celsius trades at a forward P/E ratio of 40, mirroring Monster’s price/earnings-to-growth (PEG) ratio. However, Celsius’s expanding market share in the U.S. and potential international opportunities make it an attractive long-term prospect. While finding the precise bottom of a declining stock is challenging, those confident in Celsius’s future should consider a gradual investment approach to mitigate risk.

Investment Considerations: Is Amazon the Right Choice?

Before rushing to invest $1,000 in Amazon, consider this:

The Motley Fool Stock Advisor team has identified what they believe are the 10 most promising stocks for investors to consider now, and surprisingly, Amazon is not on this list. These top 10 stocks could offer substantial returns in the years to come.

Take, for instance, Nvidia’s inclusion on this list on April 15, 2005. An investment of $1,000 at that time would have grown to $722,320.*

The Stock Advisor service offers investors a straightforward path to success, providing guidance on portfolio building, regular analyst updates, and two new stock picks each month. Since 2002, Stock Advisor has delivered returns more than four times that of the S&P 500.*

Explore the 10 stocks ›

*Stock Advisor returns as of September 17, 2024

Henry Lawson
Henry Lawson

Henry Lawson: The Sage of Screen Stories

At 50, Henry Lawson stands as a seasoned pillar in the realm of TV entertainment journalism, offering a wealth of experience and a discerning eye cultivated over decades of reporting. With his distinguished brown hair, now gently touched by the wisdom of silver, Henry has become a trusted name for insightful television news and analysis.

Born and raised in the culturally rich city of New Orleans, Louisiana, Henry's early years were steeped in the vibrant narratives of southern storytelling—a heritage that sparked his lifelong love for the art of narrative. His fascination with television began with classic shows of the '70s and '80s, which he watched with his family, fostering a deep appreciation for the evolution of storytelling on the small screen.

Henry pursued his passion academically at New York University, where he majored in Media Studies. After graduating, he embarked on a storied career that saw him writing for some of the most prestigious entertainment publications in the industry. His articles are known for their depth, blending historical context with current trends to provide a comprehensive view of the ever-evolving television landscape.

Having witnessed the seismic shifts from network dominance to the streaming revolution, Henry has become an authority on the subject, often called upon for his commentary on television panels and podcasts. His work not only covers the latest news but also delves into the cultural impact of television, exploring how it reflects and shapes society.

Outside of his professional endeavors, Henry is a devoted family man. He shares his life with his wife, Clara, a talented painter, and their two children, both of whom have inherited their parents' artistic inclinations. Family movie nights remain a cherished tradition, where classic films and new series alike are enjoyed and discussed in detail.

An avid jazz enthusiast, Henry spends his free time attending local jazz festivals and playing the saxophone, a nod to his New Orleans roots. He also enjoys gardening, finding peace and inspiration in cultivating his backyard oasis, where he often retreats to brainstorm his next article.

Henry Lawson's career is a testament to his enduring passion for television and storytelling. As he continues to chronicle the ever-changing world of TV entertainment, his readers rely on his seasoned perspective to navigate the complex tapestry of stories that captivate audiences around the globe.

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