Investors could get whiplash watching the stock market collapse last year, then quickly rebound to regain all the lost ground and go on to set new record highs.
It took the S&P 500 less than six months to make up the dramatic deficit it incurred at the start of the pandemic, and it has gone on to gain another 45% since then. In short, from trough to peak, the broad market index has doubled in value in less than 18 months.
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That shows the importance of holding on through thick and thin and letting your stocks play out over the long term, and it means there's never a bad time to invest -- and always having money available, even small amounts, is a good strategy for everyone.
So if you have $200 ready to invest that won't be needed to pay bills or cover an emergency, should one arise, the following trio of companies are some of the smartest stocks you can buy right now.
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Fiverr
Freelancing-marketplace operator Fiverr International (FVRR -1.44%) is something of the old guard in the gig economy, having been founded more than a decade ago as a way to connect independent freelancers with companies that need their services. And it is arguably one of the best at doing so. Instead of going through an agency or looking for someone on a professional networking platform, you go on Fiverr's online service portal.
Because Fiverr freelancers present their services as gigs, or packages, with set prices for their work, the purchase process is an easy, straightforward one, which explains how Fiverr has earned its explosive growth.
Although it naturally got a surge in business during the early days of the pandemic, it continues to expand at a rapid rate. Third-quarter revenue was up 42%, while the number of active buyers jumped 33%, allowing spending per buyer to rise 20% over the year-ago figure.
Fourth-quarter revenue is expected to climb another 33% to 39%, and full-year revenue should be 54% to 56% above 2020, or as much as $205 million. Wall Street forecasts revenue will grow 35% annually through 2023, and analysts have set a $226 consensus price target on the freelance platform's stock, indicating 60% upside potential over the next year.
The company pegs its U.S. addressable market at $115 billion per year and as much as $750 billion globally, and it should benefit from the network effect as it expands its internet retail platform and more content creators sign on. And if you invest $200 in Fiverr now, the company won't need to grab a large share of the global market to deliver several-hundred-percent returns over the coming decade.
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Salesforce.com
Customer relationship management (CRM) specialist Salesforce.com (CRM -1.59%) reported third-quarter earnings that disappointed the market because guidance was not as strong as hoped for. But investors should use that as a buying opportunity.
It shouldn't have been unexpected that a decline in software spending by small- and medium-sized businesses due to the COVID-19 pandemic had an impact on Salesforce's quarterly performance. While revenue and profits topped analyst expectations, aided in part by the acquisitions of business communications expert Slack, business website developer Mobify, and company management specialist Vlocity (it was Slack's first full quarter of contribution), the software-as-a-service (SaaS) stock said full-year revenue would be in a range of $7.224 billion to $7.234 billion. The midpoint of that range sits slightly below Wall Street's estimates of $7.23 billion.
That's OK, because as chairman and CEO Marc Benioff said, "Salesforce is more relevant and strategic than ever as every company accelerates their digital transformation journey."
Salesforce was responsible for 20% of all global CRM spending in 2020 -- more than Oracle, SAP, Microsoft, and Adobe combined -- and by partnering with the SaaS leader, analysts at IDC estimate businesses will generate $6.19 of additional revenue for every $1 Salesforce makes.
Wall Street still expects Salesforce to double its revenue by the middle of the decade, with earnings before interest, taxes, depreciation, and amortization (EBITDA) expanding by a similar rate.
Salesforce stock has rocketed 757% higher since 2011, compared to just 265% by the S&P 500. With shares down by about 20% from their recent high, a couple of C-notes from investors today could enjoy substantial appreciation in the years to come.
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The Trade Desk
The Trade Desk (TTD 0.85%) is another SaaS stock with enormous potential for growth as it continues to build out its dominant programmatic ad buying platform.
Revenue has been running white-hot over the past four years, rising 300% over that time period, and it's up 55% to $801 million so far in 2021. Adjusted EBITDA is also 39% higher over the first nine months of the year.
What's helping The Trade Desk grow so fast is not so much that customers are spending more with it (which they are), but also that they keep coming back. The ad-buying platform's customer retention rate was 95% in the latest period, as high as it has been for the past seven years. That's allowed it to secure the No.-6 spot on Fortune's list of the top 100 fastest-growing companies of 2021, and positions it as one of the industry's premier software companies.
The Trade Desk continues to improve upon the tools it provides its customers, giving them greater control over the process by allowing them to adjust the granularity of the detail they adopt. Solimar is the new cloud-based advertising trading platform, and The Trade Desk anticipates it will bring in the majority of impressions by the beginning of 2022.
That's likely why Wall Street forecasts revenue will triple by 2025, with a nearly four-fold increase in earnings per share. Though not a cheap stock, at around $100 per share The Trade Desk is worth getting in on now.
