Do you have $1,000? These 2 stocks could be good buys for 2023 and beyond



Got a cool grand piano burning a hole in your pocket? If you fancy investing that excess money, you’re in luck – there’s a lot of great buys in today’s stock market, and I don’t mind sharing some of my best ideas with you. .

The two high-growth tech stocks below are prime candidates for a $1,000 investment: Independent Market Operator Fiver International (NYSE: FVRR) and network performance and security expert Cloudy (NYSE:NET). They look just as good but for very different reasons.

So let’s dig in and find out why these stocks may be the best picks for 2023 and beyond.

Fiverr: Powerhouse of the gig economy

As the leader in online freelance services, Fiverr connects 2.5 million freelancers with 4.3 million active buyers. Fiverr’s user-friendly platform makes it easy for freelancers to find work and for buyers to find the services they need. And judging by Fiverr’s strong business results, it’s a win-win situation for buyers, sellers, and the service provider.

Despite an inflation-tinged economic crisis, Fiverr’s revenue grew 13% year-over-year (YOY) in 2022. Factoring in this temporary slowdown, the compound average growth rate (CAGR) of Fiverr’s on line revenue is up 47% over the last five years. The global online freelance services market is expected to grow at a CAGR of 14% from 2022 to 2030, and the business is poised to thrive. The platform’s ability to connect freelancers and buyers around the world makes it a strong contender to benefit from the gig economy and globalization trends.

With adjusted net income of $0.60 per diluted share in 2022, Fiverr’s profitability is equally remarkable. Trading at a price-to-earnings (P/E) ratio of just 21x forward estimates, Fiverr’s stock even looks like a reasonable value investment. Stock prices have gained 25% since the start of the year and the first quarter earnings report is fast approaching. Investors may want to act before this opportunity slips away.

Cloudflare: A Cloud Computing Innovator

Like Fiverr, Cloudflare is showing exceptional growth, with a five-year sales CAGR of 48%. Although its valuation may seem high, the company’s strong growth potential in booming markets makes it a tempting investment.

As a market leader in cloud computing, Cloudflare operates a global network of data centers that provide a comprehensive portfolio of network services to over 10 million websites and applications. Chief among these network tools is Cloudflare’s Content Delivery Network (CDN), which also serves as an anti-piracy buffer against Distributed Denial of Service (DDOS) attacks.

Cloudflare’s revenue soared 49% year-over-year in 2022, and the global cloud computing market is expected to grow at a CAGR of 14% from 2023 to 2030. So the company’s outlook looks bright. Cloudflare’s adjusted earnings of $0.13 per share in 2022 corresponds to a net profit margin of 5%. That’s not too shabby, given the tough market conditions.

With its innovative approach and strong leadership team, Cloudflare is well-equipped to capitalize on the long-term trend of digital transformation.

Why $1000? Why now?

A $1,000 investment may not seem like a game changer. And that may be true, depending on your budget and day-to-day cash flow. Ultimately, only you can make that call. But it’s far better than nothing and certainly enough to start building a substantial portfolio over time. If you can commit to making regular investments of $1,000, perhaps monthly, you will soon see a substantial portfolio taking shape in that brokerage account.

When you invest in Fiverr, Cloudflare, and other fundamentally sound high-growth companies, you should see significant returns over time. This is especially true when starting from a relatively low purchase price.

After the inflation crisis of the past year and a half, the global economy is eager to get back to business as usual. Fiverr and Cloudflare look forward to normal spending habits, especially from enterprise-wide customers. Normalcy is finally in the cards, as inflation slows and governments around the world move away from extreme inflation-fighting policies.

This is only good news for Cloudflare, Fiverr and their investors.

It’s time to act on these opportunities

Fiverr is on the rise after a painful year, with a new earnings report to be released on May 11. Recent reports from tech industry giants suggest positive trends in related areas such as digital advertising and business services. Therefore, Fiverr seems like an extremely timely investment this week.

Shares of Cloudflare took a beating after last Thursday’s strong earnings report with modest revenue guidance for the next quarter. However, keep in mind that the company has a habit of setting attainable sales targets only to knock the reported results out of the park. In other words, this stock may be undervalued today as analysts and investors took Cloudflare’s weak Q1 sales forecast as gospel.

As always, you should be aware that investing comes with inherent risks and there are no 100% guarantees in this messy reality. That said, both stocks look poised to benefit from long-term growth in their respective operating markets. At the very least, investors looking to diversify their portfolios in the proverbial Silicon Valley direction should revisit Fiverr and Cloudflare.

10 stocks we like better than Fiverr International
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* Portfolio Advisor Returns as of April 24, 2023

Anders Bylund holds positions at Fiverr International. The Motley Fool holds positions and recommends Cloudflare and Fiverr International. 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.



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