Although Elon Musk’s support helped Dogecoin benefit from a skyrocketing rally earlier this year, the cryptocurrency has plunged more than 30% over the past month with China's intensifying crackdown on cryptocurrencies on concerns over massive energy consumption in the mining process and illegal activities using these digital currencies. Because these are deemed legitimate concerns, governments around the globe might follow China and implement their own restrictions on cryptocurrencies. Furthermore, the Federal Reserve’s indication that it may increase interest rates sooner than previously anticipated could create put more pressure on risky assets like cryptocurrencies. So, we think the prospects for Dogecoin look bleak.
In contrast, quality growth stocks are gaining investor attention amid the economic recovery given their ability to grow faster by capitalizing on supportive fiscal and monetary policies. This is evidenced by the SPDR Portfolio S&P 500 Growth ETF’s (SPYG) 4.4% returns over the past month compared to the SPDR Portfolio S&P 500 Value ETF’s (SPYV) 2.1% loss and the SPDR S&P 500 Trust ETF’s (SPY) 1.2% gain over the same period. According to The Conference Board, the U.S. real GDP is expected to rise 9% in the second quarter of 2021, which bodes well for growth stocks.
So, we think it could be wise to bet now on Pfizer Inc. (PFE) and Broadcom Inc. (AVGO) because they possess solid growth attributes and are well positioned to deliver impressive returns.
Pfizer Inc. (PFE)
PFE discovers, develops, markets, and sells biopharmaceutical products worldwide. It offers medicines and vaccines in various therapeutic areas and is involved in the contract manufacturing business. The company has collaboration agreements with Bristol-Myers Squibb Company (BMY), Astellas Pharma, Inc. (ALPMY), Myovant Sciences Ltd. (MYOV), and BioNTech SE (BNTX).
On June 8, PFE reported that the U.S. Food and Drug Administration (FDA) had approved its PREVNAR 20 for the prevention of invasive diseases and pneumonia in adults ages 18 years and older. Nanette Cocero, Global President of Pfizer Vaccines, said “We are thrilled with this approval as it furthers our mission to expand protection against disease-causing bacteria serotypes.”
PFE’s revenue surged 45% year-over-year to $14.58 billion for its fiscal first quarter, ended April 4. Its income from continuing operations grew 96% year-over-year to $4.88 billion. Its adjusted income came in at $5.26 billion, which represents a 48% year-over-year increase. The company’s adjusted EPS was $0.93, up 47%% year-over-year.
Analysts expect PFE’s EPS and revenue to increase 71.6% and 77.9%, respectively, year-over-year to $3.81 and $74.55 billion in its fiscal year 2021. It surpassed consensus EPS estimates in three of the trailing four quarters. The stock has advanced 19.6% over the past year to close yesterday’s trading session at $39.61.
PFE’s POWR Ratings reflect solid prospects. The company has an overall A rating, which translates to Strong Buy in our proprietary ratings system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
The stock has a B grade for Quality, Value, Growth, Stability, and Sentiment. To see the additional POWR Ratings for PFE (Momentum), click here. It is ranked #3 of 226 stocks in the Medical - Pharmaceuticals industry.
Click here to checkout our Healthcare Sector Report for 2021
Broadcom Inc. (AVGO)
AVGO designs, develops, and supplies semiconductor infrastructure software solutions. The company's infrastructure software solutions enable customers to plan, develop, automate, manage, and secure applications across mainframe, distributed, mobile, and cloud platforms. It offers semiconductor devices with a focus on complex digital and mixed signal complementary metal oxide semiconductor-based devices.
Click here to checkout our Semiconductor Industry Report for 2021
On June 15, 2021, AVGO announced new, industry-first capabilities for Value Stream Management (VSM) in its ValueOps software portfolio. The new capabilities seamlessly combine the proven investment planning features of Clarity with the advanced agile management capabilities of Rally software. This innovation could increase the demand for AVGO’s solutions in the coming months.
AVGO’s net revenue increased 15% year-over-year to $6.61 billion for the second quarter ended May 2, 2021. Its adjusted EBITDA grew 23.4% year-over-year to $3.96 billion, while its non-GAAP net income increased 28.3% year-over-year to $2.98 billion. The company’s non-GAAP EPS increased 28.8% year-over-year to $6.62.
For the quarter ending June 30, 2021, analysts expect AVGO’s EPS to be $6.85, representing a 26.9% year-over-year increase. It surpassed consensus EPS estimates in each of the trailing four quarters. The company’s annual revenue is expected to increase 14.1% year-over-year to $27.24 billion in its fiscal year 2021. The stock has gained 48.1% over the past year to close yesterday’s trading session at $464.45.
AVGO’s POWR Ratings reflect this promising outlook. The company has an overall A rating, which translates to Strong Buy in our proprietary ratings system.
The stock has a B grade for Quality, Stability, Growth and Sentiment. Within the B-rated Semiconductor & Wireless Chip industry, AVGO is ranked #2 of 98 stocks. To see AVGO’s rating for Momentum and Value as well, click here.
Recently the Reitmeister Total Return Portfolio (RTR) closed a winning trade in AVGO for a 25% gain. Learn more about the RTR service here.
PFE shares were trading at $39.10 per share on Wednesday morning, down $0.51 (-1.29%). Year-to-date, PFE has gained 8.43%, versus a 13.97% rise in the benchmark S&P 500 index during the same period.
About the Author: Nimesh Jaiswal
Nimesh Jaiswal's fervent interest in analyzing and interpreting financial data led him to a career as a financial analyst and journalist. The importance of financial statements in driving a stock’s price is the key approach that he follows while advising investors in his articles.
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