We’re already in the second half of the year and the earnings season begins this week. The past quarter has been incredible for several companies with stocks hitting new all-time highs. The S&P 500 is setting new records and the Nasdaq is on an upward rally. With the earnings season, pre-earnings stocks could gain further momentum and move higher.
As companies report impressive growth, there’s a chance your investment could see solid gains. If you want to make the most of the upcoming earnings season, here are three stocks to buy. These are already trading at an all-time high. However, they are solid buys and you won’t regret holding on to these stocks for the next five years. Also, Wall Street is bullish on these three opportunities. Let’s delve in.
Nvidia (NVDA)
Nvidia (NASDAQ:NVDA) has generated 150% returns since the end of 2023 and is one of the hot artificial intelligence (AI) stocks to add to your portfolio. The company has grown its market value from $1.2 trillion to close to $3 trillion, driven by the soaring AI demand. Earlier, it made the majority of its revenue from the gaming sector. But now it makes maximum revenue from its data center segment.
Additionally, Nvidia can capitalize on the rising demand for graphics processing units (GPUs) and repeat last year’s success. The company has managed to beat expectations in the previous quarters by reporting strong revenue growth. And, it is set to do the same in the upcoming quarterly results.
NVDA stock rallies after the results and takes the market with it. For the second quarter, it is aiming for a revenue of $28 billion, up from the $26 billion it reported in Q1. Its revenue has grown five times in the past five years.
Trading at $131.38, the stock is up over 130% year-to-date (YTD. Fortunately, the stock split has made it possible for many investors to own shares. I believe Nvidia will report another stellar quarter, driven by the rising demand for AI chips and the new government contracts it has signed. AI will supercharge its growth for the next five years. Therefore, plan to buy the stock before the earnings season begins and take home strong gains.
Amazon (AMZN)
Up 32% in the first half of the year, Amazon (NASDAQ:AMZN) is trading at $199.34 today. It could very well keep soaring higher in the second half. The company has recovered from the lows of 2022 and is enjoying a solid momentum. An e-commerce giant, Amazon grows at a rapid pace with diversification on its side.
Moreover, the company offers a variety of products and services across multiple industries which ensure steady revenue growth. Also, its global presence makes it a low-risk business to own during market uncertainty.
Amazon holds the largest market share in cloud computing and a large part of its revenue comes from this segment. The company reported an impressive first quarter with a 13% jump in net sales to $143.3 billion and an operating income of $10.4 billion. As Amazon completes three decades in the industry, growth is on its side.
Some investors worry that the company’s e-commerce sales could dip in the event of a recession. But fortunately for Amazon, the majority of the revenue comes from Amazon Web Services (AWS). Besides that, it depends on advertising and subscription revenue which shows steady growth.
For Q2, it is aiming for sales between $144 billion and $149 billion and operating income between $10 to $14 billion. AMZN stock is trading at a new high, but it is worth buying for a stellar second half of 2024.
Alphabet (GOOG, GOOGL)
Trading at $188.98, Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) is a no-brainer stock to own for the second half. If you believe in the future of AI and want to make the most of the hype, consider Alphabet. The company has seen significant growth since the past year and the stock is up 36% YTD.
It generates the maximum revenue from Google Cloud, Google search engine and YouTube. The cloud revenue was up 28% year-over-year (YOY) in the first quarter and hit $9.6 billion. In addition, the search revenue soared 14% to $46 billion and ad revenue from YouTube jumped 21% to $8 billion.
The company already holds a strong position in the industry and has been investing in AI to ensure it remains at the top. It has the potential to continue generating higher revenue from digital advertising by adding AI to its services.
With AI, it could create targeted advertising, and when advertisers see higher conversions, they will be happy to put more money into Alphabet. In the first quarter, the advertising segment generated 76% of the total revenue for the company.
With a 90% market share in online search, Alphabet is already at the top and has ample opportunities to monetize here. While the stock is near the 52-week high, it is cheaper than the other “Magnificent Seven” and buying the stock below $200 could be a solid move. I think Alphabet holds a strong market position and is in an ideal position to benefit from AI.
On the date of publication, Vandita Jadeja did not hold (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.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.