Sarah Travers
Investing in growth stocks can be a strategic way to enhance your portfolio’s value over time. While dividend stocks might appear safer and provide recurring income, growth stocks often promise more significant returns in the long run. If you’re looking for promising growth stocks to buy for less than $100, consider Walmart, Starbucks, and Shopify. These three companies offer substantial growth potential, making them excellent choices for both new and seasoned investors.
Walmart: More Than Just Retail
Walmart’s business model has evolved significantly over the years. Initially recognized as a retail giant, the company has expanded into grocery and is now taking on Amazon in the online shopping arena. This expansion reflects Walmart’s continuous efforts to grow and diversify its business.
A key factor in Walmart’s growth strategy is its pending acquisition of TV maker Vizio. This move aims to bolster Walmart’s advertising business, positioning it as more than just a retail stock. Despite occasional setbacks, such as its venture into healthcare, Walmart’s willingness to explore new avenues makes it a strong candidate for growth investors.
Financially, Walmart remains robust. Over the past 12 months, the company generated $18.9 billion in profit on $657.3 billion in revenue. Although these figures represent light profit margins of less than 3%, Walmart’s status as a low-cost leader ensures consistent earnings, with at least $11 billion in profit in each of the last four fiscal years. Trading at around $70 per share, Walmart is an affordable option for investors, offering numerous growth opportunities.
Starbucks: Efficiency and Expansion
Starbucks has faced challenges recently, with a growth rate that has not met expectations. Inflation has led some consumers to switch to cheaper coffee options. In any case, the long-term prospects remain promising.
Economic recovery is expected to restore consumer spending power, allowing Starbucks’ loyal customer base to justify higher spending on their favorite coffee. Additionally, Starbucks plans to cut costs by $3 billion over the next few years to improve efficiency and competitiveness. This strategy could significantly enhance earnings without aggressive growth.
Starbucks also plans to expand its store network, aiming to add 17,000 stores by 2030. The company’s focus on efficiency and expansion positions it well for future growth. With profit margins at 11%, Starbucks outperforms Walmart in this regard. Trading near its 52-week low at around $76, the stock presents a potentially undervalued investment opportunity with a favorable price-to-earnings multiple of 21.
Shopify: Capitalizing on E-commerce Growth
Shopify, priced at approximately $63, is the most affordable stock on this list. After experiencing a pandemic-driven boom, Shopify’s stock has corrected, but the company remains well-positioned for future growth.
Shopify’s strategic shift away from logistics to leverage Amazon’s vast fulfillment network is a key development. This agreement allows Shopify merchants to benefit from Amazon’s capabilities, improving long-term profitability. Additionally, Shopify’s partnership with Target enhances merchant visibility, with select products available in Target stores.
In just three years, Shopify’s revenue has grown from $2.9 billion in 2020 to over $7 billion, showcasing significant business expansion. The company’s recent deals and growth opportunities make Shopify a strong contender for long-term investment, particularly as the economy improves and consumer spending increases.
Affordable Growth Opportunities
For investors seeking affordable growth stocks, Walmart, Starbucks, and Shopify offer compelling options under $100. Walmart’s diversification and consistent earnings, Starbucks’ efficiency and expansion plans, and Shopify’s strategic partnerships and revenue growth position these companies as attractive investment opportunities.
Each of these stocks presents unique advantages, from Walmart’s broad business scope to Starbucks’ strong profit margins and Shopify’s e-commerce potential. By considering these growth stocks, investors can potentially achieve substantial portfolio gains in the long run, making the most of their investments today and in the future.
