David Jagielski, The Motley Fool
·4 min read
It may seem like $100 isn't a lot of money to invest in the stock market. But over time, you can add to that total and grow your stake in a business. Investing even a small amount is a good way to at least get your feet wet and slowly gain some exposure to a stock without going all-in right away.
There are plenty of good growth stocks out there where $100 will allow you to own at least one full share of the business. Three stocks investors should consider investing in for the long term are PayPal (NASDAQ: PYPL), Palantir Technologies (NYSE: PLTR), and CRISPR Therapeutics (NASDAQ: CRSP). Here's why these can be excellent investments in the years ahead.
1. PayPal
PayPal stock currently trades around $61 per share, which is arguably a steal of a deal for this fintech company. A few years ago, the stock was easily trading at more than double that value. Investors are concerned about the company's growth prospects, as there's more competition from other online payment services.
But the digital payments industry is massive. Analysts at Markets and Markets project it will be worth $193.7 billion by 2028 (versus $111.2 billion in 2023). It's a growing industry as consumers continue to spend more money online. And there's plenty of room for multiple platforms.
Even if Apple Pay and other services take greater pieces of the pie, PayPal remains one of the top online payment options in the world. As long as the industry keeps growing, PayPal's business should too. From 2019 through 2022, the company's revenue has more than doubled, from $17.8 billion to $27.5 billion.
At a forward price-to-earnings (P/E) multiple of just over 11, the fintech stock looks incredibly cheap, compared to the S&P 500 average, where investors are paying a multiple of 21 times future earnings.
2. Palantir Technologies
To buy a share of Palantir, you'll have to spend less than $18 today. The data analytics company has generated impressive growth over the past few years. From less than $743 million in 2019, its top line has nearly tripled to $1.9 billion in 2022. What's exciting is that Palantir is still experiencing strong growth, thanks to artificial intelligence (AI).
More companies are becoming interested in AI, which has resulted in a flurry of demand for Palantir's products and services. Through the first nine months of 2023, the company's sales have already totaled $1.6 billion, increasing at a rate of 16% year over year.
More importantly for value investors, during that period, the company reported a profit of $120.5 million. This was a significant improvement from the $404.6 million loss Palantir incurred over the same time frame in 2022.
The business is profitable now. Considering that the company's revenue growth still looks good, it may not be too late to invest in this growth stock.
While Palantir's forward P/E of nearly 60 looks steep, when looking at the next five years, the stock's price-to-earnings-growth ratio (PEG), is right around 1. This suggests it's a good value buy for investors willing to hold on for the long haul.
3. CRISPR Therapeutics
The smallest stock on this list by market cap is CRISPR Therapeutics. Its market cap is barely $5 billion but could get a lot bigger in the future. CRISPR is fresh off its first product approval of Casgevy, a gene therapy treatment for sickle cell disease, so its financials should improve dramatically in the years ahead.
CRISPR will have to share Casgevy revenue with its development partner Vertex Pharmaceuticals. This treatment, however, will cost $2.2 million (CRISPR will get a 40% share of the profits), which should result in a considerable margin for the companies to split.
CRISPR's stock trades at around $63 per share. Although it isn't profitable and its top line hasn't been growing steadily in recent years, the future has never been brighter for the company. If you're willing to buy and hold, this is another great stock to load up on right now.
Should you invest $1,000 in Palantir Technologies right now?
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David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple, CRISPR Therapeutics, Palantir Technologies, PayPal, and Vertex Pharmaceuticals. The Motley Fool recommends the following options: short December 2023 $67.50 puts on PayPal. The Motley Fool has a disclosure policy.
3 No-Brainer Growth Stocks to Buy for Less Than $100 was originally published by The Motley Fool
