In this article, we discuss the 5 best growth stocks for 2022. If you want to read our detailed analysis of these stocks, go directly to the 10 Best Growth Stocks for 2022.
5. Sprout Social, Inc. (NASDAQ:SPT)
Number of Hedge Fund Holders: 29
Sprout Social, Inc. (NASDAQ:SPT) makes and sells web-based social media management tools. The company recently announced that it would be bringing social messaging app WhatsApp into the Sprout product suite. This will enable the firm to offer personalized customer service to enterprise clients. WhatsApp has over 2.5 billion active users globally.
Needham analyst Scott Berg recently raised the price target on Sprout Social, Inc. (NASDAQ:SPT) stock to $160 from $110 and kept a Buy rating on the shares, noting that there was confidence in the ability of the firm to deliver 30%+ revenue growth for the coming years.
Among the hedge funds being tracked by Insider Monkey, Washington-based investment firm Zevenbergen Capital Investments is a leading shareholder in Sprout Social, Inc. (NASDAQ:SPT) with 1.2 million shares worth more than $153 million.
In its Q2 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Sprout Social, Inc. (NASDAQ:SPT) was one of them. Here is what the fund said:
“Sprout Social (is one of the) companies that have become go-to platforms for small and medium size businesses (SMBs) engaged in e-commerce and social media marketing, rebounded strongly in the quarter after being caught in the selloff among high-multiple growth names since Vaccine Monday. These and the portfolio’s other disruptors had thrived through the first part of the pandemic, leading us to trim positions into strength and reallocate cash into more attractively priced evolving opportunities and steady compounders that had been overly punished by lockdowns and a drop in economic activity.”
4. Lattice Semiconductor Corporation (NASDAQ:LSCC)
Number of Hedge Fund Holders: 19
Lattice Semiconductor Corporation (NASDAQ:LSCC) is a semiconductor manufacturing company based in Oregon. The firm is well poised to benefit from the increased government spending on American chipmakers in 2022 as supply chain pressures bite.
Lattice Semiconductor Corporation (NASDAQ:LSCC) posted earnings for the third quarter on November 2, reporting earnings per share of $0.28, beating estimates by $0.04. The revenue over the period was $131 million up 28% year-on-year.
At the end of the third quarter of 2021, 19 hedge funds in the database of Insider Monkey held stakes worth $366 million in Lattice Semiconductor Corporation (NASDAQ:LSCC), down from 24 in the preceding quarter worth $306 million.
In its Q4 2020 investor letter, Artisan Partners Limited Partnership, an asset management firm, highlighted a few stocks and Lattice Semiconductor Corporation (NASDAQ:LSCC) was one of them. Here is what the fund said:
“Lattice Semiconductor is a vendor of field programmable gate array (FPGA) chips used in personal computers, 5G infrastructure, routers and switches, and servers, to name a few. The company now has a new board and management team—the current CEO joined from leading microprocessor provider Advanced Micro Devices in late 2018—which have embarked on a product-transformation journey. The company has refreshed its FPGA products in the small/low power segment of the market—making it more focused on addressing high return-on-investment use cases centered around power-efficient applications—carving itself a niche behind the two market leaders focused on high-end, Xilinx and Intel Corporation. In addition to providing FPGA chips to data centers and new 5G infrastructure— particularly compelling opportunities given these end markets are and will likely continue benefiting from strong secular tailwinds—we believe the company is well positioned to tap into lowpower/reprogrammable chips as well as industrial and automotive end markets.”
3. Varonis Systems, Inc. (NASDAQ:VRNS)
Number of Hedge Fund Holders: 27
Varonis Systems, Inc. (NASDAQ:VRNS) markets software products and related services. As enterprise spending on cybersecurity soars, Varonis could benefit from an expanding product suite in the area. In September, the company launched Data Classification Clouds, a solution that monitors and protects data across multiple apps.
In August, investment advisory Wolfe Research initiated coverage of Varonis Systems, Inc. (NASDAQ:VRNS) stock with an Outperform rating and a price target of $80. Analyst Alex Zukin identified the firm as “one of the best growth stories” in his coverage.
Among the hedge funds being tracked by Insider Monkey, Massachusetts-based firm Matrix Capital Management is a leading shareholder in Varonis Systems, Inc. (NASDAQ:VRNS) with 1.2 million shares worth more than $75 million.
2. TopBuild Corp. (NYSE:BLD)
Number of Hedge Fund Holders: 17
TopBuild Corp. (NYSE:BLD) is a Florida-based homebuilding company. It recently acquired Tonks Insulation and Shepherds Insulation, two homebuilding firms that have robust pipelines and generated over $6 million in revenue last year. The purchase adds to the specialty distribution capabilities of TopBuild ahead of 2022.
Truist analyst Keith Hughes recently raised the price target on TopBuild Corp. (NYSE:BLD) stock to $300 from $253 and kept a Buy rating on the shares, noting that the firm was showing good margin growth going into 2022.
At the end of the third quarter of 2021, 17 hedge funds in the database of Insider Monkey held stakes worth $93 million in TopBuild Corp. (NYSE:BLD).
1. Trupanion, Inc. (NASDAQ:TRUP)
Number of Hedge Fund Holders: 16
Trupanion, Inc. (NASDAQ:TRUP) provides medical insurance for pets. The insurance industry has a compound annual growth rate of around 23% and Trupanion is one of the largest players in the sector. It has also built trust and confidence among customers that provides the company with a solid foundation for growth heading into 2022.
Trupanion, Inc. (NASDAQ:TRUP) smashed market expectations on earnings per share and revenue for the third quarter by $0.01 and $3.8 million respectively. The company has a market cap of $5 billion and was founded in 2000.
At the end of the third quarter of 2021, 16 hedge funds in the database of Insider Monkey held stakes worth $259 million in Trupanion, Inc. (NASDAQ:TRUP).
In its Q3 2021 investor letter, Polen Capital, an asset management firm, highlighted a few stocks and Trupanion, Inc. (NASDAQ:TRUP) was one of them. Here is what the fund said:
“Trupanion reported mixed earnings results, mostly due to higher-than-expected costs of new pet acquisition. The increased spending is intended to drive future growth. We continue to believe Trupanion’s long-term growth prospects and competitive positioning remain compelling in an underpenetrated U.S. pet insurance market.”
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