The stock market has been a remarkable place to build and sustain meaningful returns over time. The performance of your individual portfolio will depend on how much you invest, how often and where you put your money to work.
Spreading your investment capital across a wide range of companies and investing consistently when the market goes up and down can increase the performance of your portfolio over the years. If you currently have money to invest in stocks, here are two top names to consider in the new bull market.
1. Fiverr
Fiverr (NYSE: FVRR) The stock is down about 5% from a year ago, despite the fact that the company continues to make progress in a challenging operating environment and rapidly improves its bottom line. The rise of artificial intelligence is changing many industries, and the freelance world is no exception.
While some may fear that tools and technology like generative AI will replace the need for talented freelancers, the future is likely to be much more nuanced. These tools are far from perfect, and while some tasks can be performed entirely by AI, many tasks require the assistance of human expertise to deliver an exceptional final product.
Fiverr responds to this vision. Over the past year, it has launched a range of AI-driven services, including everything from a matching service that helps companies find the right freelancer to new AI-focused job categories. The company has also focused on offering more complex services, which may use AI but require a skilled human freelancer to get the job done.
The growth of complex services, including tasks such as financial advisory, AI development, and mobile app development, is driving steady growth for Fiverr in a competitive environment. In the company’s first quarter shareholder letter, management noted a boom in the number of AI services offered on the platform, which now includes offerings like AI avatar design and custom GPT (Generative Pre-training Transformer) applications. At last count, Fiverr had 10,000 AI experts in its marketplace.
On the financial front, Fiverr posted revenue of approximately $94 million in the first quarter of 2024, up 6% from the same period in 2023. It also reported a net profit of $0.8 million, compared to a net loss of $4.3 million in the previous year. quarter. That follows 2023, in which Fiverr delivered annual net income of just under $4 million, its first profitable year as a company.
The number of active buyers fell 6% year-over-year in the first quarter of 2024, but spending per buyer actually rose 8% from the same period a year ago. Additionally, Fiverr’s cohort of high-value buyers (those who spend more than $500 per year) increased 4% year over year in the first quarter of 2024.
Fiverr achieved operating cash flow of approximately $21 million, a notable increase of 57% from a year ago. It also continues to keep pace with its track record of high gross margins, reporting 83.5% last quarter, up 130 basis points from a year ago. The company’s take rate (the portion of each transaction that Fiverr executes) was 32.3% at the end of last quarter, up 190 basis points from the previous year.
While the company may face continued doubts from investors about its ability to perform in a post-pandemic environment, there are several green flags for this company. That could provide an attractive buying opportunity for those with the right investment horizon.
2. Lyft
Things are looking for Lyft (NASDAQ: LYFT). The mobility app’s shares are up as much as 76% from their position a year ago – and up about 14% since the start of 2024. That’s slightly more than the S&P500‘s performance so far this year, as the index is up about 12% since early January.
Improvements in earnings and revenue, as well as generally strong growth rates, appear to have renewed investor interest in this ridesharing stock. Meanwhile, increasingly favorable cash flow numbers, rapid expansion in Canada (currently the only international market), and a steady increase in bookings are all green flags for this company.
The rideshare market suffered significantly during the worst of the pandemic. Companies like Lyft have been working to regain solid financial footing after this period, and as rideshare competition continues to increase.
In 2023, Lyft reported that gross bookings and ridership reached record highs. The company provided more than 700 million rides last year, while gross bookings increased 14% compared to 2022 to just under $14 billion. Sales also rose 8% to $4.4 billion.
Fast forward to the most recent quarter, the first three months of 2024, and gross bookings increased 21% year over year to $3.7 billion. Lyft generated $1.3 billion in revenue this quarter, a healthy 28% increase over the same period last year.
It also delivered 188 million rides in the three-month period, up 23% year over year. Active riders, which are riders who take at least one ride with Lyft in the quarter, improved 12% year over year to 21.9 million.
Although the company continues to operate at a net loss under generally accepted accounting principles (GAAP), this figure has fallen to $31.5 million, compared to $187.6 million in the same quarter in 2023. Lyft also brought in $59.4 million in adjusted profit before interest and depreciation. and depreciation (EBITDA), an increase of 162% compared to a year ago.
The first quarter of 2024 was Lyft’s second consecutive quarter of positive free cash flow. That figure totaled $127 million, following the previous quarter’s figure of $14.9 million. Management also stated that the company plans to achieve positive free cash flow for the full year 2024. There’s a lot to be said about this stock’s price, and long-term investors could find this a ride worth a multi-year purchase. and hold position.
Should You Invest $1,000 in Fiverr International Now?
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Rachel Warren has no positions in any of the stocks mentioned. The Motley Fool holds positions in and recommends Fiverr International. The Motley Fool has a disclosure policy.
2 Top Stocks That Could Explode in the Bull Market of 2024 and Beyond was originally published by The Motley Fool
