On Wednesday, the Federal Reserve decided to maintain its benchmark interest rate without making any changes. There is increasing confidence that the U.S. will reach normal price levels with little chance of slipping into recession. Economic growth next year is expected to hit 2.1%. That figure is impressive considering that in June, the Federal Open Market Committee indicated that the economy would only grow 1% in 2024. If the forecasts are correct then now is the perfect time to invest in overlooked growth stocks that are flying under the radar.
Advanced Micro Devices (AMD)
Advanced Micro Devices (NASDAQ:AMD) is a semiconductor company that creates computer processing devices. The emerging electrical vehicle industry presents an opportunity for semiconductor companies to thrive by implementing processors to support the cars systems. Additionally, the substantial use of AI and machine learning is skyrocketing demand for semiconductors which are necessary to produce rapid results.
AMD is showcasing healthy growth prospects compared to its sector, with sales growing by 43.61% last year. And, AMD stock has gone up 50% year-to-date (YTD).
A prominent catalyst for AMD is its ability to innovate in a diverse variety of industries. Recently, the company used its adaptive computing technology to power adaptive cruise control and automatic emergency braking systems. Moreover, the company has extended its reach by introducing the new graphics cards. Through offering some of the most powerful hardware and software, AMD has put itself ahead of competitors.
NXP Semiconductors (NXPI)
NXP Semiconductors (NASDAQ:NXPI) is a Dutch Semiconductor design and manufacturing company.
NXPI shows healthy financials, with $3.3 billion in revenue for Q2 2023. That beat analyst expectations by $92 million. NXPI also demonstrates great profitability through a 21.1% net profit margin, and $698 million in net income.
The company has created partnerships that expand its global reach, poising the company for future growth. NXP has partnered with several other companies to help facilitate the growth of semiconductor startups in India. This partnership gives NXP early access to semiconductor startups which have the potential to disrupt the market. NXPI has also partnered with Taiwan Semiconductor Manufacturing Company (NYSE:TSM) and others to bring advanced semiconductor manufacturing to Europe. This investment will give NXPI access to customers in European markets, which weren’t accessible before.
The company’s healthy financials, industry growth, and partnerships that position NXP for global expansion are all reasons that paint a positive outlook for NXP Semiconductors.
Chipotle Mexican Grill (CMG)
Chipotle Mexican Grill (NYSE:CMG) is an American fast casual restaurant that specializes in customizable burritos. The fast-casual restaurant industry which has a market size of 189.7 billion in 2022 and is expected to grow. Factors for this growth include urbanization and the public’s desire for a healthier alternative to fast food.
Chipotle has had a strong quarter seeing revenues rise from $8.63 billion in 2022 to $9.28 billion in 2023. CMG also saw an immense levered free cash flow growth seeing it increase by 46.26%. That is a whopping 257.44% more then the sector median of 12.94%. These metrics indicate that Chipotle is both profitable and efficient and is a dominant player in the industry. Thanks in part to these figures Chipotle’s stock is up 36% YTD.
Due to Chipotle’s strong financials and growing platform, I give it a buy rating. This is one of the overlooked growth stocks which should provide your portfolio with a little nourishment.
On the date of publication, Michael Que did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
The researchers contributing to this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.