In the wake of the “Magnificent Seven” dominating 2023, attention is shifting to a potential shakeup in the stock market hierarchy for 2024. While Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta Platforms, and Tesla took center stage last year, a new set of contenders, dubbed the “Fab Four,” emerges as promising players to watch.
1. Visa (NYSE: V): Visa, with its enduring presence, may lack the excitement of newer entrants, but its consistent performance makes it a standout choice. With a compound annual growth rate (CAGR) of 21% over 15 years, Visa’s straightforward business model, centered on fees for payments on its extensive network, has yielded remarkable results. Fiscal year 2023 saw 212 billion transactions, a $12 trillion payment volume, $32.7 billion in revenue, and $17.3 billion in net income. Shareholder rewards, including $16.1 billion in buybacks and dividends, underscore Visa’s reliability, making it a top contender for success in 2024.
2. CrowdStrike Holdings (NASDAQ: CRWD): As a leading cybersecurity provider, CrowdStrike holds a crucial position in a world grappling with escalating cyber threats. Boasting a 35% revenue growth in its most recent quarter, CrowdStrike’s AI-enabled security modules are in high demand. Its subscription-based model, constituting 94% of revenue, and a clientele using multiple security modules (63%) position the company for significant growth in 2024.
3. Shopify (NYSE: SHOP): Shopify, an e-commerce platform, aims for a robust rebound in 2024 following setbacks in 2022. Cost-cutting measures and strategic partnerships with notable brands like Crate & Barrel, Allbirds, and Blendjet have fueled a resurgence. With a rebounding free cash flow of $548 million and a three-year revenue growth average of 43%, Shopify emerges as a rising star and the preferred e-commerce platform for influencers and emerging brands.
4. Nvidia (NASDAQ: NVDA): While a part of the renowned Magnificent Seven, Nvidia stands out as a cut above the rest. Positioned at the forefront of the AI revolution, Nvidia experiences unprecedented demand for its AI chips. The surge in AI adoption across industries, from e-commerce to education, propels Nvidia’s revenue and earnings. Analysts project a substantial increase in 2025 earnings per share (EPS), reflecting the company’s pivotal role in shaping the AI landscape. With an unparalleled demand outlook, 2024 is poised to be another stellar year for Nvidia.
As investors navigate the evolving market landscape in 2024, these Fab Four stocks present compelling opportunities for growth and resilience.
