I’m no fan of the saying, “Sell in May and go away.” Unsurprisingly, and in keeping with The Motley Fool’s guidance, I tend to hold stocks for the long term. In fact, rather than selling in May, I’m adding shares to my portfolio this month.
And, thanks to a brutal 2022, I’m going to be picking up some top-notch stocks on the cheap. So, let’s dive into my three best stock picks near the end of May: Shopify (NYSE: SHOP), Roblox (NYSE: RBLX), and Amazon (NASDAQ: AMZN).
I don’t own shares of Shopify yet, but I plan to soon. That’s because I sense this Canadian e-commerce company has turned a corner.
Shopify shares were smashed in 2022 and ended the year down a staggering 75%. However, that market smackdown has led management to reassess the business and engage in some serious belt-tightening.
Earlier this month, the company announced it was slashing 20% of its workforce; that’s on top of a 10% reduction last July. Moreover, it is streamlining its operations by selling off a delivery company and a robotics maker it acquired recently.
Yet, while the company is slimming down, it’s not slowing down. Shopify reported revenue of $1.5 billion for its most recent quarter (the three months ending March 30, 2023). That was up 25% year over year. Moreover, sales projections are optimistic, with analysts forecasting 18% revenue growth in 2024.
While the overall economy may be sluggish, I plan on holding Shopify shares for years — meaning a potential recession later this year would simply offer more opportunity to load up on shares ahead of an economic recovery.
Roblox might be a new name to some investors, but it’s a name worth knowing. This somewhat under-the-radar stock has gained a solid 40% year to date by leveraging several hot growth areas: the metaverse, gaming, and social networking.
Although the platform exploded in popularity during the COVID-19 pandemic, users have stuck around, with the result that Roblox continues to grow its key metrics. For example, in its most recent quarter (the three months ending March 31, 2023), daily average users and total hours engaged both grew more than 20% year over year.
What’s more, analysts expect that growth to continue well into the future. Sales are predicted to rise 18% in 2023 and 16% next year.
I first purchased Roblox shares after seeing how much my kids — and their friends — loved the game. Now, I’m looking to add to my position.
Finally, I’m thrilled to add more Amazon shares to my portfolio. While Amazon has been one of the best-performing stocks over the last 20 years, the stock endured a rough 2022.
However, things are looking up for the company this year. CEO Andy Jassy has made some tough decisions, such as cutting 27,000 jobs and reeling in capital expenditures.
Those cost-cutting measures and other strategic initiatives have helped Amazon’s bottom line. Net income for the most recent quarter (the three months ending March 30, 2023) bounced back to $3.2 billion — just under the company’s five-year average.
I’m eager to add a few shares now before the full effects of cost reductions have kicked in, as I plan to hold my Amazon shares for the long term.
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Jake Lerch has positions in Amazon.com and Roblox. The Motley Fool has positions in and recommends Amazon.com, Roblox, and Shopify. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.