2 growth stocks to watch for your retirement portfolio

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  • Tesla, Inc. (NASDAQ: TSLA) said it produced more than 258,000 vehicles in Q2 FY22. 
  • TSLA stock rose 9.78 per cent and closed at US$815.12 on July 21. 
  • Etsy, Inc. (NASDAQ: ETSY) stock jumped 4.5 per cent and closed at US$96.87 on July 21. .

Investing for retirement is a priority for many, and there are a plethora of options to choose from for investment. For investors exploring the equity market for retirement, growth stocks can be an avenue to look at.

Growth stocks generally belong to companies whose revenue and income are expected to increase at a faster pace than the average market. Some investors often explore growth stocks as they generally offer an innovative product or service that gives them a competitive edge and a possibility to expand in the future. 

Here we discuss two growth stocks that have reported expansion in past years.

Tesla, Inc. (NASDAQ: TSLA)

Tesla reported that it manufactured over 258,000 vehicles in Q2 FY22 while delivering some 254,000 units. 

Its Gigafactory, Berlin, is said to have seen a production of over a thousand vehicles in a single week during Q2 FY22. Tesla said that it plans to invest more and maximize production in its factories in Berlin and Austin.

For the second quarter of 2022, its revenue increased to US$16.93 billion in Q2 2022, up 42 per cent from US$11.96 billion in the same quarter a year ago. Tesla also reported a GAAP net income of US$2.26 billion in this quarter, reflecting a 98 per cent increase from that of US$1.14 billion in the previous year.

The EV maker is said to have reported consistent revenue increases in the last three years. For fiscal 2019, its revenue was US$19.36 billion, which rose to US$24.6 billion in FY 2020 and US$44.13 billion in the fiscal year ending December 31, 2021.

TSLA stock rose 9.78 per cent and closed at US$815.12 on July 21. Its P/E ratio is 98.21, and the forward P/E for one year is 79.29.

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Etsy Inc. (NASDAQ: ETSY)

Etsy operates in the US, the UK, Australia, Canada, Germany, and France. It connects buyers and sellers to exchange creative and vintage goods through its online market. It generates revenue from listing fees, advertising, payment processing, commission on sales etc.

For the quarter ended March 31, 2022, Etsy generated a revenue of US$579 million compared to US$550.6 million for the corresponding quarter in 2021.

Etsy posted a net income of US$86.11 million, which was a 40 per cent decline from US$143.77 million in Q1 FY21. The e-commerce player noted that this was primarily due to increased product development and general and administrative expenses. 

ETSY’s revenue increased from US$0.818 billion in fiscal 2019 to US$2.33 billion in fiscal 2021. Its net income also grew from US$95.9 million in FY 2019 to US$493.5 million in FY 2021. 

The stock jumped 4.5 per cent and closed at US$96.87 on July 21. 

Bottom line:

Growth companies tend to invest their profits back in business to grow further, unlike companies that pay dividends to the investors.

In the inflationary scenarios, growth stocks can see a decline. Some long-term investors often use this downturn to explore growth stocks for the long run. 

However, growth stocks can be a high-risk option as they tend to belong to small and mid-cap companies. One must look at the growing market trends and analyze fundamentals carefully. 



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