Three Revolutionary Growth Stocks

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It’s human nature to love a good story, whether it’s told orally, read from a book, or experienced in video form. There’s even a science of stories, called Narratology, which looks at stories from two angles: the plot, and the process of presentation. Today, I’m focusing on plot, and eventually I’ll tie this into investing – and three revolutionary growth stocks.

Back in 1959, William Foster Harris described his theory of three basic plot patterns (happy ending, unhappy ending and tragedy).

In 1993, Ronald Tobias set out a twenty-plot theory (including underdog, metamorphosis, ascension and descension).

And in 2004, Christopher Booker described the seven major plots of stories (Overcoming the Monster, Rags to Riches, The Quest, Voyage and Return, Comedy, Tragedy and Rebirth).

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But all those writers were writing about fiction, and today I want to explore the basic stories of non-fiction, as they relate to the world we experience around us every day—a story that, from our perspective, never ends.

My contention, in short, is that, as individual humans who have each had a variety of experiences that have made us what we are, we each see the world in different ways—and ways that are sometimes slightly different and sometimes vastly different.

This, of course, is not a new thought. It’s been phrased most succinctly and elegantly by Horace Walpole, who in 1769 wrote, “This world is a comedy to those that think, a tragedy to those that feel.”

But once we understand that the lens through which we observe the world is no less important than elements of the world that we are viewing, we come to see that everyone is experiencing a different story—watching a different movie.

Which Movie Are You Watching?

As I look at the developments of the world today, these are some of the movies I see.

There’s the Democracy Movie, which kicked off in earnest in 1776 and continues as the U.S. works to spread its system across the globe, resisting a succession of dictators, autocrats, oligarchs, despots, monarchs and tyrants.

There’s the Freedom Movie, where individuals struggle for agency and dignity against the forces of government and/or business.

There’s the Law and Order Movie, where people struggle to preserve the homeland as they know it from a variety of interlopers, criminals and evildoers.

There’s the Immigration Movie, featuring as heroes successive waves of needy striving immigrants who moved to the U.S. not only to escape difficult situations but also to work hard, assimilate and contribute to our country’s growth.

There’s the Equal Rights Movie, where oppressed groups of people, frequently defined by their sex or race or religion or occupation, work to achieve equal rights with the ruling class.

There’s the Science and Technology Movie, featuring never-ending progress and promising that robots and space travel and customized medicine will make it even better.

There’s the Capitalism Movie, where hard-working men and women (and robots) create goods and services that consumers want, while creating jobs, growing shareholder value and paying taxes.

And there’s the Investing Movie, where men and women deploy their hard-earned capital into these enterprises with the goal of seeing their capital grow—or at least provide a steady income—so they can enjoy a comfortable retirement.

This, of course, is the movie that I’ve spent a lot of my time watching throughout my career, and thus it’s the story—for better or worse—that I tend to reference as I view developments in the world.

I do respect the movies that other people are watching; indeed, I often watch them myself. But in this forum, you want my expertise on investing, which is dependent on capitalism, and so that’s what I’m providing today.

Three Great Revolutionary Growth Stocks

With that long introduction, today’s main course is short and sweet. Below are three revolutionary companies that are changing the world for the better and have the potential to bring big gains to investors in the years ahead. Their one commonality is that they all use the power of the internet to provide services that were impossible just 20 years ago.

Revolutionary Growth Stock #1: Carvana (CVNA)

Used car salespeople are some of the least trusted people in the U.S.; only members of Congress rate lower. Carvana replaces them with a very easy-to-use web site (check it out for yourself), a very robust system of car acquisition and delivery and—most fun of all—car vending machines in many markets.

In the latest quarter, revenues grew 127% to $476 million, while the loss was $0.41 per share; the company is still in investment mode.

Carvana (CVNA) is one of three revolutionary growth stocks I see today.The chart is in a strong and steady uptrend.

Revolutionary Growth Stock #2: Teladoc Health (TDOC)

Teladoc allows you to avoid time-consuming trips to doctors’ offices by getting expert opinions in virtual face-to-face meetings with a qualified doctor on your phone or other device. It’s so cost-effective that CVS just made Teladoc its partner with the service.

In the latest quarter, revenues grew 112% to $95 million, while the loss was $0.40 per share; the company is still in investment mode.

The stock built a nice base from July 2017 through January 2018, but since then it’s been in a strong uptrend.

Revolutionary Growth Stock #3: Grubhub (GRUB)

Grubhub is the most popular online and mobile food-ordering company in the world, connecting people to more than 85,000 takeout restaurants in 1,600 cities in the U.S. and London.

In the latest quarter, revenues grew 51% from the year before to $240 million, while earnings grew 92% to $0.50 per share.

As for the chart, GRUB built a nice base from March through July, but blasted off in August after releasing its earnings report, and has been strong since.

Final Notes:

All three of these companies have great long-term growth prospects as they add convenience to our lives.

All three of these companies are growing fast.

All three of these revolutionary growth stocks have the potential to be much higher years from now.

To get up-to-the-minute advice on investing in these and other great growth stocks, I recommend you become a regular reader of Mike Cintolo’s Cabot Growth Investor.

To learn more, click here.

Timothy Lutts

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