2 Growth Stocks That Could Skyrocket in 2024

Investors have already seen some big stock price jumps in 2024. Several winners are in the popular artificial intelligence (AI) space, of course, with companies like Nvidia and Meta Platforms posting excellent year-to-date returns. But there are also a few top stock performers that might surprise you. Chipotle is one of the 10 biggest gainers so far this year, for example.

The fast-food giant’s growth illustrates how excellent returns can be found in any industry and are often surrounded by mediocre performances among peers. Let’s look at a few standout growth stocks, then, that seem primed for big gains ahead this year.

1. Navigate toward growth

Garmin (GRMN 0.56%) shares are already beating the market so far in 2024, but there’s room for more growth ahead. The navigation technology specialist in early May announced stellar sales results across its diverse product portfolio. Revenue jumped 40% in its fitness wearables segment and improved by 11% in its smartwatch division. Sales were up a healthy 20% overall even as many consumer tech giants (like Apple) struggled to boost revenue.

Garmin isn’t having trouble profiting from its growth, either. Gross profitability rose to 58% of sales from 57% of sales. Operating profit jumped to a blazing 22% of sales from 17% of sales a year earlier, helping earnings rise by nearly 40%. “We attribute these noteworthy results to our strong product portfolio and the robust demand trends that we have been experiencing,” CEO Cliff Pemble said in a press release.

Most Wall Street pros see revenue rising by 12% this year, but Garmin could beat those projections with a strong holiday season performance. In any case, shareholder returns are likely to be solid as the company continues gaining market share while boosting profit margins above 20% of sales.

2. Amazing returns

Amazon‘s (AMZN 0.58%) business can still expand from here despite its already massive sales footprint. The e-commerce giant most recently achieved 13% higher sales to push first-quarter revenue up to a healthy $143 billion. That growth came mainly through a surging services sector. Its Amazon Web Services sales jumped 17%, and AWS is now running at an annual rate of $100 billion with help from soaring demand for AI-powered cloud services.

Amazon has a great shot at expanding its software-as-a-service platform over the next few years as more companies modernize their tech infrastructures. The e-commerce segment provides solid economics thanks to Amazon’s massive scale. Add the Prime subscription service, streaming video, and digital advertising, and there’s no shortage of growth areas. “It’s very early days in all of our businesses,” CEO Andy Jassy told investors in late April.

The even better news for investors is that Amazon is finally allowing its growth to translate into significant financial wins. Free cash flow in the past year has been $50 billion, up from an outflow of $3 billion a year earlier. Profit more than tripled last quarter to $10 billion.

The stock’s valuation is still attractive, too. Shares are priced at 3.4 times sales today or about double the low that investors saw in early 2023. However, that still translates into a discount from the P/S ratio of over 4 through the later stages of the pandemic. Amazon should deliver strong returns for long-term investors at that price in 2024 and beyond.

Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Demitri Kalogeropoulos has positions in Amazon, Apple, Chipotle Mexican Grill, and Meta Platforms. The Motley Fool has positions in and recommends Amazon, Apple, Chipotle Mexican Grill, Garmin, Meta Platforms, and Nvidia. The Motley Fool has a disclosure policy.