3 Robinhood stocks to buy right now
Not so long ago, serious investors only accepted recommendations from their brokerage firms, or at least third-party research provided by their broker. Advice from non-professionals has generally been ignored.
But a lot has changed in the last few years, namely that technology has empowered the average amateur investor. And, it turns out, those amateur stock pickers — even those with modestly sized startup accounts — can be pretty savvy.
Here’s a look at three of the most popular picks from brokerage app users Robinhood Markets (HOOD -4.54%) are currently holding. They are far from the dangerously speculative names you might expect. Indeed, they are so distinctly chippy blue that you might want to add them to your portfolio too.
walmart (WMT -0.57%) is of course the largest brick and mortar retailer in the world, operating over 5,000 locations in the United States alone, and about as many stores outside the United States. No rival even comes close to his physical footprint.
Admittedly, that footprint didn’t help curb its soaring costs last quarter. In fact, its huge network of stores has driven up its logistics costs. The company saw its total revenue improve to the tune of 2.4% for the three-month period ending April, but a 3.5% increase in its cost of sales coupled with a 4.5% rise in operating expenses translated into a 23% decline in operating profit. .
Connect the dots: Skyrocketing gasoline prices, rising wholesale prices and rising payroll taxes are dramatically squeezing Walmart’s already relatively thin profit margins, causing the company to miss earnings estimates for the last quarter by a fairly wide margin and ultimately trails the stock more than 20% below the April high.
Look past all the recent noise, though, and remember what so many of Robinhood’s brokerage clients keep in mind: it’s Walmart. It has been challenged before and still stands up. This time is not likely to be any different.
Take the example of its efforts to further automate its order fulfillment work. Just last month, computer technology and robotics company Symbotic expanded a previous partnership to add automation across the retailer’s 42 regional fulfillment centers. And just last week, Walmart unveiled a partnership with DroneUp that will eventually facilitate aerial drone deliveries of online orders for 4 million American homes.
These insights ultimately help the company contain labor and gas costs, but are just a sample of the cost containment work that Walmart is doing. They just need a little more time to bear fruit.
Nvidia (NVDA -2.77%) is another name that Robinhood customers remain loyal to despite some recent, mostly bearish, turbulence in the stock. And rightly so.
The good news is that Nvidia reported record sales for the first quarter of fiscal 2023 (ending May 1). Revenue of nearly $8.3 billion was up 46% year over year, easily beating expectations.
The bad news is that even this stellar revenue growth isn’t stellar enough in the shadow of the current quarter forecast. The company is forecasting revenue of just $8.1 billion for the three-month period ending at the end of July, slightly below analysts’ projections, mainly due to logistics and supply chain issues. Nvidia Chief Financial Officer Colette Kress arguably tipped the nearly even balance in a bearish direction by adding that in light of all the uncertainties ahead, a slowdown in hiring is already in effect.
But as is the case with Walmart, these collective challenges are more temporary than otherwise. What awaits the company on the other side of all this turbulence is a huge opportunity in the artificial intelligence market.
It turns out that the same underlying technology architecture that works well for its popular video cards also works well in artificial intelligence applications. In that vein, Nvidia’s data center revenue (where its AI hardware sales are counted) of $3.7 billion last quarter not only made it the strongest growth for the period of three months, but also the company’s largest business unit.
Of course, the ongoing supply chain crisis is a challenge. With technology market research firm Technavio expecting the artificial intelligence market to grow 21% per year through 2025, Nvidia is however well positioned to overcome any challenges in the supply chain. supply in the meantime.
Finally, Robinhood app users have remained incredibly patient with PayPal Credits (PYPL -1.23%)with many of them overcoming most of the stock’s 70% drop since July last year.
The strong sell-off is quite logical at first glance. The surge in online purchases resulting from the pandemic-induced lockdowns was clearly a boon for most digital payment platforms, but this pace of growth was never going to last. Indeed, no matter what, bored consumers would eventually venture out of their homes again, where cash and credit cards are still the primary means of making purchases. Other payment platforms – and those that facilitated cryptocurrency-based payments in particular – were also being readied for launch just as COVID-19 started causing lockdowns; they continued to gain ground in the meantime.
To that end, last quarter’s payments volume growth of just 15% pales in comparison to the company’s growth rate of 46% in the prior year’s comparable quarter.
What so many Robinhood customers are seeing, however, is that PayPal is still the market leader in digital payments and is poised to remain so for a long, long time.
Leveraging its already existing reach, analysts collectively expect this year’s revenue growth projection of nearly 12% to accelerate to more than 16% next year, leading PayPal to another profit. record $4.84 per share for 2023. You can get into the fintech stock while it’s priced at less than 18 times expected earnings — far cheaper than many Robinhood users paid for it.