Many investors buy and hold tech stocks for growth. Why not? Companies in this sector outperform the world. S&P500 As far as I remember. As the 2023 tech bull market proves, some top companies may even be doing the heavy lifting for the overall market.
Smart investors jump in when a familiar stock hits a correction, hoping to be part of the recovery journey. However, most investors focus on large companies; grow up Tech stocks are hiding on the sidelines.
Today we look at three tech stocks that are showing signs of at least 10% revenue and profit growth. The companies are sorted in descending order based on the highest profit growth rate. Let's dive in.
Appfolio (APPF)
Source: Pavel Kapysh / Shutterstock.com
Cloud technology has transformed the way businesses work in many areas.companies like app folio (Nasdaq:APPF) provides real estate industry solutions that enable customers to address critical operations and digitally transform their businesses.
The company's solutions cater to both property managers and investment managers. AppFolio provides features to help with tenant screening, insurance-related risk mitigation services, payments, and property management.
AppFolio recently reported impressive quarterly results with revenue up 38% year-over-year to $187.4 million. The company's EPS improved from a loss of 99 cents to a profit of $1.07, an increase of 208% over the previous year (YoY comparison).
President and CEO (CEO) Shane Trigg attributes the company's strong performance to its commitment to innovation and service excellence. We also foster deep connections with our customers to drive their continued success.
Accordingly, AppFolio expects fiscal 2024 sales to end between $766 million and $774 million, while operating margins will increase 23% to 24%. Given its solid growth and improving profitability, it makes a lot of sense to include his AppFolio on your tech stock watchlist.
Wix.com Inc. (WIX)
Source: MagioreStock / Shutterstock.com
If you want to attract customers online, you will need a website.This allows companies to: Wix.com Inc. (NASDAQ:wicks) is an important part of a growing company's strategy to expand its business.
Wix.com provides solutions that allow businesses of all sizes to perform a variety of functions, including selling products, taking reservations, and scheduling appointments. Recently, WIX announced the release of AI Website Builder, which incorporates artificial intelligence (A.I.) into your site building experience. It also helps customers build unique and professional websites.
Additionally, Wix.com ended fiscal year 2023 on a high note, exceeding targets and signaling significant growth ahead. Sales reached $1.56 billion, an increase of 13% from the previous year. Additionally, EPS was 58 cents, an improvement of 108% from last year's loss of $7.33. This is a full two years ahead of guidance.
Additionally, the company achieved a record free cash flow margin of 16%. Finally, Wix.com expects his momentum to continue into 2024. So, with a strong product list and improved profitability targets, WIX stock should be on any growth investor's tech stock buy-and-hold watchlist.
Octa (OKTA)
Source: Lori Butcher/Shutterstock.com
If you've worked in the corporate world, you may have heard the terms single sign-on and multi-factor authentication. These security features ensure that only authorized users can access the software. With the development of technology, companies have become: Octa (NASDAQ:Octa) is an important part of protecting intellectual property and confidential company information.
Okta provides full-featured identity access management (I) Solved. This helps businesses employ multi-factor authentication, single sign-on, and other features that seamlessly manage their customers' identities within their systems.
Recently, the company announced Fine Grain Certification. This allows developers to build flexible, scalable, and easy-to-use authorization models to suit their business and intended use cases.
Okta ended fiscal year 2024 with impressive earnings and cash flow. Total revenue reached $2.3 billion, an increase of 22% over the previous year. Net loss also improved relatively, reaching -$2.17 compared to -$5.16 last year. Meanwhile, free cash flow amounted to $489 million.
Okta's focus on modernizing and simplifying identity infrastructure positions it to take full advantage of market demand. Looking ahead, Okta is optimistic about 2025 and expects total revenue to reach $2.55 billion from $2.495 billion.
So, if you want to add tech companies to your portfolio for growth, OKTA stock should be one of your targets.
On the date of publication, Rick Orford did not have (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer and are influenced by InvestorPlace.com. Publishing guidelines.
