As 2021 is finally here, it is important to make a great start. It isn’t really hard to get started in stock trading, thanks to various online trading services on offer. But you need to make the right trading decisions in January, because it sets the tone for the whole year.
Motley Fool analyst Rick Munnariz has a few stocks in mind that, he believes, have major catalysts for their prices going up this month. These stocks are Bandwidth ($BAND), Axon Enterprise ($AAXN) and Teladoc ($TDOC).
Cloud Service Stocks
Let’s look at Bandwidth. Cloud service provider Bandwidth is involved in the task of embedding 911 access, messaging, and voice into cloud-based software. 2020 saw the company experiencing rising top-line growth. Each quarter saw the company’s year-over-year revenue experiencing revenue growth.
In Q4 2019, the company’s growth was 19%, while Q1 2020 saw 29% growth, and Q2 and Q3 2020 saw 35% and 40% growth respectively. Bandwidth’s growth throughout 2020 is shown in the following chart:
The company is also experiencing rising demand. Its net retention rate rose from 116% to 131% in the past year. This indicates that returning customers spent 31% more on the company’s services than the previous year. This, Munnariz reckons, is particularly important for a SaaS stock.
Top Large-cap Performers
Healthcare tech stock Teladoc was among the top large-cap performers of 2020, when its stock rocketed 139%. In contrast, the S&P 500 only returned 18.4%, as the Motley Fool chart below shows:
The Covid-19 pandemic led people to resort to virtual consultations for managing their chronic health conditions, which undoubtedly helped the stock.
This telehealth company announced its Livongo acquisition five months back, but since then is down 20%. However, its acquisition of telemedicine company InTouch Health in a deal that concluded on July 1, 2020 gave the stock a major boost. Here’s the chart by Motley Fool tracing the growth of Teladoc from 2020 to January 2021:
Munnariz points out that Livongo opens many new possibilities for Teladoc, particularly in the management of chronic conditions. Positive outcomes have been reportedly observed in diabetes patients.
Consecutive Annual Revenue Growth
Axon Enterprise manufactures wearable cameras and Taser stun guns. It also offers the cloud platform Evidence.com that stores recorded footage. The company is in the business of helping law and civil enforcement, and just reported the sixth consecutive year of revenue growth in the region of 20% or more, based on this report by Travis Hoium. Nevertheless, the stock did have some significant up and down movement in 2020, as the chart below highlights:
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