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Sixteen stocks delivering hyper growth – more ‘must-owns’

June 16, 2020

Afterpay/ APT  Buy now pay later technology Buy @ A$56.50  MV: A$13.7bn Employees: 600  Next figures due: 19 August  Key quote: “The opportunity of a lifetime”, Nick Molnar.  Growth rate: 109pc

Bandwidth/ BAND  Communications for the enterprise  Buy @ $122  MV: $2.9bn  Employees: 772 Next figures due: 29 July  Key quote: “If you use Zoom Phone or have a Google Voice number for life, both are from Bandwidth.” David Morken, CEO, 2 May 2020  Growth rate: 31pc

Cloudflare/ NET  Global cloud platform  Buy @ $30.98  MV: $9.4bn Employees: 1,270 Next figures due: 2 September  Key quote: “The growth in Internet traffic has been unprecedented. Across our platform, we saw as much growth in traffic in 12 weeks as we have seen in the previous 12 months.” Matthew Prince, 7 May 2020  Growth rate: 48pc

Crowdstrike/ CRWD  Cloud-based cyber security Buy @ $99.02  MV: $21.4bn  Employees: 2,309  Next figures due: 4 September  Key quote: “We believe we are positioned to emerge as the structural winner and fundamental endpoint platform in the future.” George Kurtz, 2 June 2020 Growth rate: 85pc

Datadog/ DDOG  Monitoring and analytics platform for developers, IT operations teams, and business users in the cloud age.  Buy @ $81.52  MV: $24.4bn  Employees: 1,403  Next figures due: 12 August  Key quote: “We believe it is more important than ever for businesses to operate online, and that the trends of digital transformation and cloud migration remain very much intact over the long-term and may even be accelerated or amplified.” Olivier Pomel, CEO, 12 May  Growth rate: 87pc

Docusign/ DOCU  Pioneered the development of the eSignature. Today offers the world’s No. 1 eSignature solution as the core part of a broader platform for automating the agreement process. Buy @ $162.50 MV: $29.9bn  Employees: 4,000  Next figures due: 4 September  Key quote: “Much of the strong Q1 performance was driven by increased demand for a signature from organisations that suddenly needed a way to sign and manage agreements from wherever they were. We believe this surge in eSignature adoption bodes well for future Agreement Cloud expansion.”  Growth rate: 39pc

MercadoLibre/ MELI   The largest online commerce and payments ecosystem in Latin America. Buy @ $922 MV: $45.9bn  Employees: 9,703  Next figures due: 31 July  Key quote: “we have seen a strong rebound, with growth rates accelerating in April to 76pc year-on-year in items sold and 73pc FX-neutral year-on-year in GMV for that full month” Pedro Arndt, CFO, 6 May  Growth rate: 37.6pc

Pinduoduo/ PDD An innovative and fast growing “new e-commerce” platform that provides buyers with value-for-money merchandise and fun and interactive shopping experiences. Buy @ $77.50  MV: $52.7bn  Employees: 5,828  Next figures due: 27 August  Key quote: “People must now find the ways to do online what they used to do offline, whether it is going to office, shopping arm in arm at a retail mall, sharing popcorn at movies or having hard parts together. We have positioned ourselves to ride the convergence of these powerful forces.” Colin Huang, CEO and founder, 22 May 2020  Growth rate: 44pc

Sea Limited/ SE A leading internet platform in Southeast Asia and Taiwan.  Buy @ $97.25  MV: $30.25bn Employees: 29,800  Next figures due: 25 August Key quote: “The coronavirus crisis is driving a step change in the growth of the digital economy globally, particularly in the market and the segments where Sea operates. It has materially accelerated a shift to online lifestyle that is broad, deep and in our view, irreversible.” Forrest Li, CEO, 18 May  Growth rate: 58pc

Shopify/ SHOP Building a global commerce operating system along with a growing set of tools and capabilities that enable merchants of all sizes to sell to anyone, anywhere.  Buy @ $803  MV: $96bn  Employees: 5,000 Next figures due: 30 July  Key quote: “Shopify is uniquely positioned to help improve the economic lives of our merchants in this difficult environment, and in a retail landscape that is accelerating its shift online.” Harvey Finkelstein, COO, 5 May Growth rate: 47pc

Tesla/ TSLA  Accelerating the world’s transmission to sustainable energy using electric vehicles and solar power Buy @ $990  MV: $183bn Employees: 48,016  Next figures due: 22 July  Key quote: “We have the capacity installed to exceed 500,000 vehicles production this year.”  29 April 2020  Growth rate: 32pc

The Trade Desk/ TTD  A technology company that empowers buyers of advertising  Buy @ $370  MV: $17bn  Employees: 1,310  Next figures due: 6 August  Key quote: “I think there is a shift in media that started about nine weeks ago that is accelerating the move to data-driven advertising. Nowhere is this more apparent than in connected TV.” Jeff Green, CEO and founder, 9 May 2020  Growth rate: 33pc

Twilio/ TWLO  Democratised communications channels like voice, text, chat, video, and email by virtualising the world’s communications infrastructure through APIs that are simple enough for any developer to use, yet robust enough to power the world’s most demanding applications  Buy @ $203  MV: $28.5bn Employees: 2,905 Next figures due: 10 August  Key quote: “Twilio has enabled organisations to reimagine many of their communications workloads in days and weeks, not months and years.”  Growth rate: 57pc

ZoomInfo Technologies/ ZI  ZoomInfo is a leading go-to-market intelligence platform for sales and marketing teams. Its go-to-market intelligence platform delivers comprehensive and high-quality intelligence and analytics on approximately 14 million companies, including advanced attributes, technologies used by companies, intent signals, and decision-maker contact information. Its software, insights, and data enable over 15,000 companies to sell and market more effectively and efficiently  Buy @ $$49.97  MV: $7.5bn  Employees: not applicable  Next figures due: July/ August  Key quote: “According to Salesforce.com, sales representatives spend only a third of their time actually selling, in large part because they must spend so much of their time researching and organising data, which is often of poor quality.” IPO document  Growth rate: 103.4pc

Zoom Video Communications/ ZM  Connects people through frictionless video, voice, chat and content sharing and enable face-to-face video experiences for thousands of people in a single meeting across disparate devices and locations. Cloud-native platform delivers reliable, high-quality video that is easy to use, manage and deploy, provides an attractive return on investment, is scalable and easily integrates with physical spaces and applications.  Buy @ $235  MV: $67.4bn Employees: 2,352  Next figures due: 4 September Key quote: “Customers with more than 10 employees grew 354% year-over-year as we deployed millions of licenses for new customers in the quarter. One new banking customer deployed approximately 175,000 new Zoom enterprise licenses in the quarter. Usage by customers in the Global 2000 grew over 200pc sequentially. We peaked at over 300m daily meeting participants, free and paid, joining Zoom meetings in April 2020, up from 10 million in December 2019. Currently we continue to see elevated levels of participants even as governments around the globe have begun to ease stay in place restrictions. We had an approximately twentyfold increase in our metric of annualised meeting minutes run rate, which jumped from 100bn at the end of January 2020 to over 2 trillion meeting minutes, based on April 2020’s run rate.” Eric Yuan, CEO and founder, 2 June 2020  Growth rate: 169pc

Zscaler/ ZS Consolidates your stacks of gateway security appliances into integrated, cloud-based security services. Since it’s security as a service, there’s no physical or virtual hardware to deploy or manage, so getting started is simple. You can deploy services in minutes, and they can easily grow with your security needs. Buy @ $104.5  MV: $13.6bn  Employees: 1,480  Next figures due: 2 September  Key quote: “Combined, ZIA and ZPA enabled our customers to work securely from home literally overnight as quarantine orders went into effect around the globe. We saw exceptional strength in our ZPA service with over 10 times growth in usage during the quarter.” Jay Chaudry, CEO, 28 May 2020  Growth rate: 40pc

These are 16 exciting stocks that belong in any high-growth portfolio. Their sheer growth momentum attracts investors climbing aboard for the ride but ready to dive for cover at the first sign of weakness. They will be volatile but their role at the heart of the technology revolution means these are businesses that could become huge over time.

I have noticed that since 2009 stock market reactions, especially in US stock markets, have been short and sharp. They typically last around three months but can be brutal. The good news is that if you can tough it out for three months recovery can be equally swift. The technology revolution is a massive tailwind for these companies.

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