One of the best ways to build up your retirement fund is to invest your money.
With core inflation running high at 3.4% and projected to rebound with high oil prices and disruptive weather patterns, you should think of parking your money in suitable investments to hedge against this scourge.
A great method to beat inflation is to allocate your money to growth stocks.
Growth stocks comprise companies that reinvest all or the bulk of their profits to grow their business, thus paying out little or no dividends.
As the business increases its profits and becomes more valuable, its share price should also rise in tandem, netting the investor capital gains.
Over time, as you allocate more money to a portfolio of growth stocks, your retirement fund will also grow steadily and become a more valuable nest egg.
Here are four US growth stocks that hit their 52-week highs recently that you could include in your buy watchlist.
Eli Lilly (NYSE: LLY)
Eli Lilly is a pharmaceutical company with medications that are helping 51 million people around the globe
The company specialises in diabetes care, treating obesity, fighting against Alzheimer’s disease, and tackling cancer and immune system disorders.
Eli Lilly’s share price recently hit a 52-week high of close to US$630 and is up 69% year-to-date (YTD).
For the first half of 2023 (1H 2023), revenue rose 7% year on year to US$15.3 billion.
Net profit improved by 9% year on year to US$3.1 billion.
Eli Lilly also paid out a dividend per share of US$2.26 for 1H 2023, 15% higher than a year ago.
The pharmaceutical company continues to spend on research and development (R&D) to drive the growth of new products.
For 1H 2023, Eli Lilly spent US$3.7 billion or around 24% of its revenue on R&D.
Its new diabetes medication, Mounjaro, was launched in the second quarter of last year and has seen strong US uptake because of its strong efficacy and positive customer feedback.
The pharmaceutical company also has a robust pipeline of drugs in various phases of development that can be pushed out to the public in the next few years once approval has been obtained.
Alphabet (NASDAQ: GOOGL)
Alphabet is a technology conglomerate that is the parent company of search engine Google.
The company also owns video-sharing site YouTube and offers cloud services to its clients.
Alphabet’s share price hit a 52-week high of US$141.22 recently and its shares are up 56% YTD.
For 1H 2023, revenue dipped 4.6% year on year to US$137.7 billion.
Operating income edged up 0.7% year on year to US$39.5 billion but net profit slid 2.9% year on year to US$32.4 billion.
Alphabet also generated a positive free cash flow of US$27.9 billion for 1H 2023.
For the second quarter ending 30 June 2023 (2Q 2023), YouTube ad revenue inched up 4.4% year on year to US$7.7 billion.
The good news is that Google Cloud posted strong revenue growth of 28% year on year to US$8 billion and reported an operating profit of US$395 million for 2Q 2023.
Fastenal (NASDAQ: FAST)
Fastenal is a distributor of industrial and construction products.
The company’s share price recently touched a 52-week high of US$60.93 and is up 26.3% YTD.
For the first nine months of 2023 (9M 2023), sales increased by 5.7% year on year to US$5.6 billion even though there was one less business day.
Operating income rose 4.8% year on year to US$1.2 billion while net profit improved by 5.6% year on year to US$888.6 million.
Fastenal’s free cash flow also surged 85.4% year on year to US$942.2 million.
CEO Daniel Florness stated that conditions remain challenging in the third quarter (3Q 2023) with daily sales growth of just 4%, significantly below the 16% daily sales growth in the same period last year.
However, Fastenal’s onsite and functional mock-up interface installed bases as well as digital footprint continued to grow.
The company has converted 121% of its net earnings into operating cash flow, surpassing the average of 95% over the past decade.
Crowdstrike (NASDAQ: CRWD)
Crowdstrike is a cybersecurity company that provides a cloud platform for endpoint security, threat intelligence and monitoring, and cyberattack response.
The cybersecurity firm’s shares are up nearly 82% YTD and are close to their 52-week high of US$190.36.
For the first six months of fiscal 2023 (1H FY2023) ending 31 July 2023, total revenue climbed 39.2% year on year to US$1.4 billion.
Crowdstrike logged a net profit of US$9 million, reversing the net loss of US$80.8 million a year ago.
Free cash flow also improved by 42.2% year on year from US$293.3 million to US$417 million in 1H FY2023.
Management has identified a total addressable market of US$76.1 billion in 2023 which is poised to grow by 13% per annum to US$97.8 billion by 2025.
The size of this market offers Crowdstrike ample opportunities to grow both its top and bottom lines.
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Disclosure: Royston Yang owns shares of Alphabet.