Investors in the US stock market are optimistic about 2024, despite looming uncertainties and a 58.3% chance of a recession within the next 12 months, according to the New York Fed’s recession probability model. This mixed economic outlook has driven traders to seek stocks with solid growth potential and resilience in a volatile market. In this article, we will delve into 5 of the best return US stocks to buy in September 2024, focusing on companies that are well-positioned to thrive in the current economic climate. These companies span across diverse sectors, including technology, healthcare, consumer goods, and financial services, giving investors a balanced portfolio of growth and value.
The Importance of Diversification in 2024
Before we dive into the top stocks, it’s essential to underscore the significance of diversification in 2024. While some sectors might outperform others due to technological advancements, supply chain developments, or regulatory changes, others might lag. A well-diversified portfolio ensures that investors can mitigate risks and capitalize on opportunities across the board.
How to Start Investing in US Stocks Today
To make informed decisions, investors should:
- Define Financial Goals: What are your investment objectives? Growth, income, or capital preservation?
- Set Time Horizons: How long can you afford to leave your investments in the market? Short-term (1-3 years), medium-term (3-7 years), or long-term (7+ years)?
- Understand Risk Tolerance: How much volatility can you endure? High-risk investments often have the potential for high returns but can lead to significant losses in downturns.
Once these elements are in place, choosing the right stocks becomes more structured and goal-oriented.
Top 5 US Stocks with the Best Return Potential for September 2024
1. Alphabet Inc. (GOOG, GOOGL)
- Forward P/E Ratio: 19.8
- Price/Sales Ratio: 6.8
- 3-Year Avg. Annualized Revenue Growth: 17.3%
Alphabet, the parent company of Google, remains a dominant player in the technology space, with an impressive blend of revenue growth and innovative ventures. The company’s investments in AI (artificial intelligence), cloud computing, and digital advertising continue to drive its growth. With the rapid integration of AI tools in various industries, Alphabet is well-positioned to capitalize on both the B2B and B2C markets.
Investors seeking high returns from a company with a solid balance sheet and strong fundamentals should consider Alphabet as a long-term growth stock in 2024.
2. Intuitive Surgical, Inc. (ISRG)
- Forward P/E Ratio: 54.0
- Price/Sales Ratio: 19.4
- 3-Year Avg. Annualized Revenue Growth: 17.1%
Intuitive Surgical, a pioneer in robotic-assisted surgery, offers long-term growth potential thanks to its leadership in the medical robotics market. The company’s da Vinci system is widely adopted globally, and the firm is continuously innovating with new tools and platforms for minimally invasive surgery.
Healthcare remains one of the most recession-proof industries, and Intuitive Surgical’s continued growth in revenue and its strong pipeline of products make it one of the top stocks to buy in 2024.
3. The Progressive Corporation (PGR)
- Forward P/E Ratio: 17.4
- Price/Sales Ratio: 1.9
- 3-Year Avg. Annualized Revenue Growth: 13.2%
Progressive Corporation has established itself as one of the most reliable insurance providers in the US, with its strength in both personal and commercial insurance lines. Amid economic volatility, insurance companies tend to be a safe haven, offering both growth and stability to investors. Progressive’s recent tech-driven initiatives, including the use of AI in claims management and customer engagement, have helped it maintain a competitive edge.
For investors seeking value stocks with a steady dividend yield, Progressive Corporation stands out.
4. Spotify Technology S.A. (SPOT)
- Forward P/E Ratio: 40.4
- Price/Sales Ratio: 3.9
- 3-Year Avg. Annualized Revenue Growth: 19.1%
Spotify continues to dominate the music streaming industry, boasting millions of subscribers worldwide. The company’s aggressive expansion into podcasting and audiobooks presents new revenue streams. Furthermore, its AI-powered recommendation algorithms improve user engagement and retention, driving higher ad revenue and subscription growth.
While Spotify operates in a highly competitive market, its brand loyalty, innovative features, and global expansion give it strong potential for growth in 2024.
5. TopBuild Corp. (BLD)
- Forward P/E Ratio: 17.6
- Price/Sales Ratio: 2.5
- 3-Year Avg. Annualized Revenue Growth: 22.8%
TopBuild Corp, a leader in insulation installation and distribution, has gained significant traction as the housing market rebounds post-pandemic. With growing demand for energy-efficient homes and commercial buildings, TopBuild is well-positioned to benefit from green energy initiatives and government incentives aimed at reducing carbon emissions.
TopBuild has consistently delivered high revenue growth, and with a strong forward outlook, it remains an attractive stock for investors focused on infrastructure and sustainable development.
Table of US Stocks to Buy in September 2024
| Company Name | Forward P/E Ratio | Price/Sales Ratio | 3-Year Avg. Annualized Revenue Growth | Industry |
|---|---|---|---|---|
| Alphabet Inc. (GOOG, GOOGL) | 19.8 | 6.8 | 17.3% | Technology |
| Intuitive Surgical, Inc. (ISRG) | 54.0 | 19.4 | 17.1% | Healthcare |
| The Progressive Corporation (PGR) | 17.4 | 1.9 | 13.2% | Insurance |
| Spotify Technology S.A. (SPOT) | 40.4 | 3.9 | 19.1% | Technology (Music/Media) |
| TopBuild Corp. (BLD) | 17.6 | 2.5 | 22.8% | Infrastructure |
Best Mid-Cap Share to Buy in 2024
In addition to the large-cap companies mentioned, mid-cap stocks are also worth considering for investors seeking growth. Mid-cap stocks offer the potential for significant appreciation as these companies are often in the growth phase but less risky than small-cap stocks.
A few notable mid-cap stocks in the US market include:
- NVIDIA Corporation (NVDA): A leader in AI and graphics processing units, expected to continue booming in 2024.
- Zebra Technologies Corporation (ZBRA): Focuses on asset tracking technology, which is seeing strong demand across various industries.
Best Performing Mid-Cap ETFs
ETFs (Exchange-Traded Funds) are an excellent way to invest in a diversified portfolio of mid-cap stocks. One of the best-performing mid-cap ETFs in 2024 is:
- Vanguard Mid-Cap ETF (VO): A low-cost ETF that provides exposure to mid-sized US companies, with a focus on growth sectors such as technology, healthcare, and industrials.
What to Look for When Buying Stocks in 2024
When selecting stocks for your portfolio in 2024, it’s important to consider the following:
- Fundamentals: Evaluate financial health, focusing on metrics such as revenue, profit margins, and debt-to-equity ratio.
- Valuation: Ensure that the stock is fairly valued compared to its peers using metrics like price-to-earnings (P/E) and price-to-sales (P/S) ratios.
- Competitive Advantage: Look for companies with unique advantages, such as intellectual property, brand strength, or market share dominance.
- Industry Trends: Understand where the industry is headed and how the company can capitalize on new developments.
- Management: The leadership team’s track record can significantly impact a company’s success.
- Dividend Yield: For income-focused investors, dividend-paying stocks provide a steady return on investment.
- Risks: Be aware of potential risks, including market volatility, geopolitical factors, and industry-specific challenges.
Conclusion
In the current market environment, characterized by both optimism and economic uncertainty, investing in solid, high-growth companies is crucial for long-term success. The five stocks highlighted here—Alphabet, Intuitive Surgical, Progressive Corporation, Spotify, and TopBuild—each offer strong growth potential and are well-positioned to weather the challenges ahead.
While no investment is without risk, these companies boast strong fundamentals, innovative strategies, and the ability to capitalize on industry trends. Whether you’re a growth investor or looking for a balanced portfolio, these stocks represent some of the best opportunities in 2024.
Ready to invest? Start by assessing your financial goals, risk tolerance, and the time horizon for your investments. By diversifying across sectors and choosing companies with proven track records, you can make the most of the opportunities the US stock market offers in September 2024.
