If you’re a growth investor, it’s understandable if you felt discouraged in the last six months.
The NASDAQ Composite Index, the bellwether index for high-growth technology stocks, fell into a bear market after declining 28% year to date.
However, share prices are influenced not just by business fundamentals but also by sentiment.
Investors are feeling jittery about high inflation and rising interest rates that could dampen the prospects of numerous businesses.
Despite these fears, there are still companies that demonstrate steady growth.
And with share prices being depressed, it may be a great opportunity for you to scoop up some bargains.
Here are three US stocks that could deliver great returns for your investment portfolio once the economy is out of the woods.
Chipotle Mexican Grill (NYSE: CMG)
Chipotle Mexican Grill is a restaurant chain that serves Mexican cuisine without artificial colours, flavours, or preservatives.
The company owns and operates its 3,000 plus restaurants located across the US, Canada, the UK, France and Germany.
Shares of the restaurant chain are down 22% year to date, even as Chipotle delivered a respectable result for its fiscal 2021 (FY2021) earnings.
Revenue increased by 26% year on year to US$7.5 billion with comparable store sales jumping by 19.3% year on year.
Of note, digital sales grew by 24.7% year on year and comprised 45.6% of total sales.
Stripping out one-off restructuring costs and impairments, earnings per share more than doubled year on year to US$25.42 from US$10.73.
The company’s fiscal 2022 first quarter (1Q2022) results saw this growth momentum continuing.
Revenue increased by 16% year on year with comparable store sales improving by 9% year on year.
The Mexican chain also opened 51 new restaurants during the quarter and expects to open a total of 235 to 250 new restaurants this year.
Chipotle also recently rolled out its loyalty program, Chipotle Rewards, in Canada.
The company implemented its loyalty program in the US in 2019 and within three short years, has amassed a total of 28 million members.
Mercadolibre (NASDAQ: MELI)
Mercadolibre is Latin America’s largest e-commerce company and operates a platform for the buying and selling of merchandise.
It also operates a digital payments platform, Mercado Pago, and also offers a lending service, Mercado Credito.
Shares of the e-commerce outfit have tumbled 48.1% year to date, but the company continues to report encouraging financial and operating numbers.
Gross merchandise value (GMV) rose 35.5% year on year to US$28.3 billion as the number of items sold jumped 41% year on year to one billion.
Total payment volume (TPV) surged 55.5% year on year to US$77.4 billion, driven by a rush of people transacting online due to remote work and digitalisation.
Mercadolibre reported a 77.9% year on year increase in revenue while net profit came in at US$83.3 million, reversing a loss of US$707,000 the year before.
1Q2022 has seen continued growth on the company’s platform, with unique active users jumping from 70 million to 81 million.
GMV increased by 26.5% year on year while TPV surged by 72% year on year to US$25.3 billion.
Net revenue growth was equally impressive, jumping 63.1% year on year to US$2.2 billion.
Texas Roadhouse (NYSE: PH)
Moving on to another restaurant chain, Texas Roadhouse and its franchisees operate 672 restaurants in 49 states in the US and 10 other countries.
The chain serves western food in a casual dining setting with dishes such as hearty steaks, shakes, and French fries.
Texas Roadhouse navigated the pandemic well as its revenue and net profit rebounded sharply in 2021.
Total revenue rose 44% year on year to US$3.5 billion while net profit soared seven-fold year on year from US$31.3 million to US$245.3 million.
1Q2022 has seen this momentum continuing for the western restaurant chain.
Total revenue increased by 23.3% year on year to US$987.5 million with comparable store sales jumping by 16% year on year.
Net profit increased by 17.2% year on year to US$75.2 million.
A total of three company-operated restaurants and two international franchise restaurants were opened during the quarter.
The company had also completed the acquisition of seven franchise restaurants for US$26.4 million to add to its growing stable of restaurants.
Texas Roadhouse’s board of directors approved a share buyback program of up to US$300 million, and the company repurchased 1,060,618 of its shares during the quarter.
How do you decide if a growth stock is worth your money? There is no shortage of stock ideas today, but is a particular stock suitable for you? Find out more in our latest FREE report, How To Find The Best US Growth Stocks For Your Portfolio. Click HERE to download the report for free now!
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Disclaimer: Royston Yang does not own shares in any of the companies mentioned.
