Companies With Strong Growth Can Continue Trending Higher

While the market may take a pause in the coming weeks based on seasonal trends, it’s clear from earnings season that many companies are growing. And that they can continue to do so.

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  • That’s growth as measured by an increasing number of customers or an increasing number of sales. With investors still worried about the economy, companies delivering real growth can likely trend higher, and be a solid buying opportunity in the coming weeks.

    Uber Technologies (UBER) is one such growth play. They saw gross bookings jump 22 percent in the fourth quarter. That helped the rideshare company handily beat earnings.

    Uber’s overall revenues are now up 11 percent over the past year. While profit margins have been slim, Uber has been moving towards consistent profitability. Rising customers will make that trend easier.

    Action to take: Even with shares at 52-week highs, Uber has some positive momentum with its latest earnings beat. Investors can likely see some further gains from here. Patient investors may want to wait for a pullback to buy in.

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  • For traders, the May $75 calls, last going for about $4.10, could see mid-to-high double-digit returns from here. Traders may want to build a stake now, and use any down days in shares in the coming weeks to add to the position.

     

    Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.