3 Growth Stocks Ready for a 2024 Breakout

Stocks to buy

Despite the holiday season, markets and the news cycle aren’t slowing down. As we approach the New Year, information related to stocks and publicly traded companies continues to move quickly. Many stocks are breaking out on news related to earnings, share repurchases, and potential mergers. Investors would be smart to seize on these developments, take positions in securities that are beginning to rise above their moving averages, and stage a rally. While the market has come far in 2023, there are signs that the rally will continue into the coming year. Buying into growth stocks now will position investors for future gains. Here are three growth stocks ready for a 2024 breakout.

Micron (MU)

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On the day of this writing, shares of Micron Technology (NASDAQ:MU) were up 7% after the chipmaker posted better-than-expected financial results and provided a bullish outlook related to artificial intelligence (AI) demand. Micron reported a loss of 95 cents per share for its fiscal first quarter, which was better than analysts’ expected loss of $1.01. Revenue amounted to $4.73 billion, which topped analysts’ forecasts of $4.58 billion.

Looking ahead, Micron forecast revenue of $5.30 billion for the current quarter, above the consensus expectation of $4.97 billion. However, what lit a fire under MU stock was the company’s strong outlook for AI. On the earnings call, Micron’s leadership team said that generative AI would drive “multiyear growth” at the semiconductor company. Micron also said that inventory levels for its memory and storage chips are now normal. MU stock is up 67% in 2023.

CarMax (KMX)

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CarMax’s (NYSE:KMX) stock is also up 7% in a single trading session after the used-car retailer announced that it is resuming the stock buyback program that it had halted in 2022. The company said it has $2.41 billion remaining in the share repurchase program that it paused last year and will buy back 648,500 shares for $41.9 million in the fourth quarter. News of the stock buyback program being restarted came as CarMax reported mixed financial results.

For the company’s fiscal third quarter, CarMax announced earnings per share (EPS) of 52 cents, beating Wall Street forecasts of 38 cents. The earnings were up 117% from 24 cents a year earlier. CarMax’s revenue of $6.15 billion missed the $6.29 billion that analysts had penciled in for the company. Sales were down 3% from a year ago. Despite the mixed results, investors are piling back into KMX stock on news of the stock buybacks. CarMax’s share price is up 32% this year.

Warner Bros. Discovery (WBD)

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What if Warner Bros. Discovery (NASDAQ:WBD) buys and merges with rival Paramount Global (NASDAQ:PARA)? Media reports say this is a real possibility after Warner Bros. CEO David Zaslav and Paramount CEO Bob Bakish met to discuss a combination that would create an entertainment giant that will have the scale to better compete in streaming against industry leaders such as Netflix (NASDAQ:NFLX). Once the dust settled, a merger with Paramount would be a catalyst for WBD stock.

Warner Bros. currently owns several studios and television properties, such as cable channels CNN and HBO, as well as streaming platform Max. Film franchises owned by Warner Bros. include “Batman” and “The Matrix.” Paramount also has a studio, the CBS television network, cable operations that include Nickelodeon and Comedy Central, and streaming platform Paramount+. Its film franchises include “Star Trek” and “Indiana Jones.”

While the merger talks are preliminary, it’s an intriguing development that makes WBD stock one to watch. Year-to-date, WBD stock has increased 17%.

On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

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