In last-year's difficult market, growth stocks were among the first to suffer. That's because when times are tough, investors tend to prefer the safest of assets -- such as long-established companies that pay dividends, for example.
But this drop in growth stocks offers us a big opportunity now. And that's the chance to scoop up these players at a great price.
Why should we be confident about growth stocks? History shows us that bear markets don't last forever. And these sorts of markets don't necessarily change the overall long-term outlook for a high-growth company. So let's get ready for a brighter future by checking out three no-brainer growth stocks to buy this year.
1. Moderna
Moderna (MRNA -0.58%) went from zero product revenue prior to the pandemic to about $18 billion annually over the past two years. That's thanks to the biotech's coronavirus vaccine and booster.
Now heading toward a post-pandemic world, Moderna's growth is likely to cool down. This year will be a transition year for vaccine makers. Demand is on the decline from the early pandemic days, and Moderna will start selling directly to pharmacies, instead of to governments.
But here's why that shouldn't stop you from buying this terrific stock. Even with a drop in demand, vaccine sales still will likely represent blockbuster revenue for Moderna -- every year, as people return for boosters.
Moderna also plans on significantly raising the price of its booster. This may help compensate for lost demand.
At the same time, Moderna is moving many candidates through the pipeline. And three -- vaccine candidates for flu, respiratory syncytial virus, and cytomegalovirus -- may launch in the next few years. Each is a billion-dollar opportunity.
All of this opens the door to amazing growth this decade -- for Moderna's earnings and potentially for your portfolio, if you buy this innovative biotech stock.
2. InMode
InMode (INMD 0.40%) sells radiofrequency devices for a variety of aesthetics and wellness treatments, including treatments to remove sunspots or unwanted hair. The stock sank last year, despite InMode's ongoing growth. So it's fair to say this stock may be ripe for recovery, especially considering the latest financial update.
InMode recently offered a sneak peek at its fourth-quarter and full-year earnings. The company predicts record revenue and record non-GAAP earnings per diluted share in the quarter. And non-GAAP gross margin is expected to be at least 83% for the full year.
It's also important to remember that InMode operates in a high-growth market. The global non-invasive aesthetics treatment market is forecast to progress at a compound annual growth rate of more than 15% through 2030, according to Grand View Research.
Today, InMode shares trade for less than 20 times trailing-12-month earnings. When it was trading at this level a couple of years ago, revenue was much lower.
INMD PE Ratio data by YCharts. PE ration is price to earnings ratio.
Considering InMode's growth in recent times and future prospects, the shares look like a buy right now.
3. CRISPR Therapeutics
CRISPR Therapeutics (CRSP -1.98%) is getting closer and closer to a very big moment: the potential launch of its first product. The biotech company and partner Vertex Pharmaceuticals submitted exa-cel, their treatment for blood disorders, to regulators in Europe, the U.K., and the U.S. late last year.
Regulatory approval could be big for a couple of reasons. First, exa-cel uses CRISPR's gene-editing technology -- so an approval would be a vote of confidence for Crispr's science. Second, exa-cel has blockbuster potential -- so it could result in major revenue for CRISPR.
And here's why exa-cel may generate significant sales. Today, treatment options are limited for blood disorders beta thalassemia and sickle cell disease. Exa-cel is designed as a one-time curative treatment. This means it could fulfill an unmet need.
CRISPR and Vertex also are testing exa-cel in pediatric phase 3 trials. If all goes well there, the companies could see a broader audience for the potential treatment in the coming years.
Finally, CRISPR's pipeline could lead to other product launches in the not-too-distant future. The company recently reported positive data from a trial of oncology candidate CTX-110 -- and launched a phase 2 trial that may support a regulatory submission.
Today, CRISPR is trading lower than it was when we had a lot less visibility about the future. Now, at this level and with many potential catalysts ahead, CRISPR is a no-brainer buy.
