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4 US Stocks You Can Buy With Your First Paycheck

·5-min read
Electronic Signature
Electronic Signature

Last week, we featured four Singapore stocks that can be bought with your first paycheck.

However, if you’re looking to invest outside of Singapore, there are plenty of options available in countries such as the US.

The larger and more liquid market there opens up many more opportunities that you can tap on to invest that first dollar.

Here are four US stocks you can buy when you receive your first salary.

1. Zoom Video (NASDAQ: ZM)

Zoom Video Communications, or Zoom, is a secure and reliable video communications platform that enables virtual meetings, chats, webinars, to online events.

It soared in popularity and the company’s name became a verb during the peak of the pandemic.

Fiscal year 2022’s (FY2022) revenue grew more than six-fold from FY2020.

Source: Zoom, Annual reports, results and operations

This growth is also seen in its net income, which grew more than 54 times in the same period.

Source: Zoom, Annual reports, results and operations

While it is not realistic to expect the same explosive growth moving forward, Zoom has been shifting its lens towards the Enterprise Customer crowd.

Enterprise revenue made up 52% of its total revenue for 1Q2023.

In 1Q2023, Zoom saw a 31% year on year growth in Enterprise revenue to US$560m.

Zoom’s total number of Enterprise customers that contributed more than US$100,000 in annual billings also grew 46% year on year to 2,916 customers in 1Q2023.

For FY2023, Zoom expects revenue to grow by another 10% year on year to US$4.5 billion.

2. JD.com (NASDAQ: JD)

JD.com is an e-commerce giant that started off by  specialising in the sale of electronic products and has subsequently expanded its product niches.

Today, it’s a leading supply chain-based technology and service provider.

The company has consistently invested in its logistics infrastructure and owns a network of about 1,400 warehouses, spanning a gross floor area of more than 25 million square metres.

These investments are paying off as it is able to offer quick deliveries down to the last-mile where it matters.

Instead of using other third-party delivery logistic players, JD.com relies on its own.

This control over the whole delivery and fulfilment process elevates the experience of end users as speed and delivery quality can be maintained at highly efficient levels.

With over 580 million active annual users, JD.com has grown at a monstrously fast pace.

Net revenue grew at a compound annual growth rate (CAGR) of 30% from 2016 – 2021 to RMB 951.6 billion.

Source: JD.com, 1Q2022 earnings release, net revenues breakdown

This growth momentum continued into 2022 with JD.com reporting an 18% increase in 1Q2022’s revenue of RMB 239.7 billion, compared to 1Q2021’s revenue of RMB 203.2 billion.

JD.com declared a special cash dividend of US$0.63 per ordinary share or US$1.26 per American depository share on 4th May 2022.

3. Apple (NASDAQ: APPL)

Apple, the company that revolutionised the smartphone era, needs no further introduction.

It is the largest contributor to the S&P 500 index.

Despite Apple’s current supply chain woes, demand for its products remains high.

Apple surprised many investors by beating analysts’ consensus when its 2Q2022 revenue came in at US$97.3 billion, versus expectations of US$94 billion.

Apple’s Services Revenue, which includes businesses such as App Store, Apple TV+, Apple Music, and cloud services saw continued growth.

Apple has a network reach of some 825 million paid subscribers, which was 165 million more than what it had a year ago.

In 2Q2022, Services Revenue  grew to US$19.8 billion, representing year on year growth of 17.3%, the fastest among its four other segments.

Source: Apple 10-Q SEC filings, products and services performances

Apple’s profit margins are high, with 2Q2022 gross margin at 43.7% and 1Q2022 net income margin at 25.7%.

A quarterly dividend of US$0.23 was also declared for 2Q2022.

4. DocuSign (NASDAQ: DOCU)

DocuSign is an e-signature platform provider that enables organisations to automate, sign, and manage agreements electronically across practically any smart device.

It boasts a wide user network of more than a billion users worldwide, of which more than 1.24 million are paying customers.

Its customers’ base has been growing at a stellar CAGR of 40% from FY13 to 1.24 million in 1Q2023.

This growth is also apparent in its enterprise and commercial customer pools, which also saw a CAGR of 51% from FY13 to 182,000 as at 1Q2023.

Source: DocuSign, 1Q2023 earnings release, customer base breakdown

On the back of such customer network strength, revenue grew more than 116% to US$2.1 billion from FY2020 to FY2022.

This momentum has been carried over into its 1Q2023 numbers, with 1Q2023’s revenue growing 25% year on year to US$589 million.

DocuSign also enjoys a 114% net dollar retention rate as of 1Q2023 and commands high gross margins.

Total gross margin in 1Q2023 was 81%, with operating margin of 17% in 1Q2023.

For FY2023, Docusign expects revenue to grow by another 17.7% year on year to US$2.48 billion.

How do you decide if a growth stock is worth your money? There is no shortage of stock ideas today, but is a particular stock suitable for you? Find out more in our latest FREE report, How To Find The Best US Growth Stocks For Your Portfolio. Click HERE to download the report for free now!

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Disclaimer: Kent Lee owns shares of Zoom, Apple, and DocuSign.

The post 4 US Stocks You Can Buy With Your First Paycheck appeared first on The Smart Investor.

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