2 Extraordinary Growth Stocks to Buy Now at $80 for Long-Term Holding

Investors should endeavor to seek out competitively advantaged businesses trading at reasonable prices, especially those with compelling growth prospects. Over the past year, withS&P 500indices(SNPINDEX: ^GSPC)Up 27%, valuations have undoubtedly become less attractive. However, there are still worthwhile buying opportunities in the market.

For example.Shopify (NYSE: SHOP)respond in singingAdvantage Technologyfirms(NYSE: UBER)Not only are the valuation multiples reasonable, but both stocks are relatively affordable at under $80 per share.

1. Shopify

Shopify is an omni-channel commerce solution for businesses. Its platform unifies physical and digital storefronts, allowing merchants to manage orders and inventory from a single noodle. Its software integrates with marketplaces, social media, customized websites, and mobile applications, and Shopify offers complementary financial services such as payment processing and financing, as well as marketing, logistics, and wholesale solutions.

Merchants find this value proposition so attractive that Shopify accounts for more than $10% of U.S. online retail sales. This makes it second only toAmazonShopify is the second largest domestic e-commerce company in the world. In addition, Shopify is a leader in the e-commerce and omni-channel commerce software market, which means that Shopify will benefit as more and more retail and wholesale is conducted through digital channels.

Shopify announced its fourth quarter financial results, which showed a strong performance, exceeding expectations on both the top and bottom lines. Total revenue increased 24% to $2.1 billion, driven by strong growth in the subscription and merchant services divisions. At the same time, non-GAAP net revenues more than quadrupled to $441 million as a result of cost containment efforts, including workforce reductions and the divestiture of the capital-intensive logistics business.

Koon also talked about the strong momentum in wholesale e-commerce, a relatively new focus for Shopify. Wholesale e-commerce, also known as business-to-business or B2B e-commerce, is an area where Shopify's total dollar volume of merchandise transactions grew by 1,50% in the fourth quarter. It's worth noting that the wholesale e-commerce market is roughly triple the size of the retail e-commerce market, and is growing even faster.

Retail e-commerce sales are expected to grow at 11% per year through 2030, while wholesale e-commerce sales are expected to grow at 18% per year over the same period. But Wall Street expects Shopify to exceed both figures, growing sales at 22% annually over the next five years, a consensus expectation that justifies its current valuation of 13.9x sales. Investors with a five-year horizon should not hesitate to buy a small amount of the stock today.

2. YouBuy Technology

Uber generates revenue from three business segments: (1) mobile mobility; (2) express delivery; and (3) freight transportation. Its mobile platform connects users to transportation, primarily ride-sharing services but also including rental cars and taxis. The company's takeout platform connects consumers with restaurants and convenience stores to order food, cargos, and alcohol for pickup or delivery to their homes. Its freight platform connects shippers with carriers to provide on-demand logistics services.

Uber is benefiting from an interesting networking phenomenon. As access increases, Uber's ride sharing and meal delivery services will become more attractive options. But the two ecosystems are connected through a mobile app, which creates a cross-selling opportunity for Uber. In other words, the company can encourage ride-sharing customers to use meal delivery services, and vice versa. As each ecosystem expands, these cross-selling opportunities become more important, enhancing the potential network benefits.

Uber had a strong fourth quarter. Monthly active platform users grew 151 TP3T to 150 million. Revenue grew 15.1TB to $9.9B, driven by strong growth in mobile and modest growth in takeaway, offset by lower trucking sales. On the net profit side, GAAP net profit jumped 1,28% to US$0.66 per diluted share as cost control efforts continued to pay off.

Uber is well positioned to maintain this momentum. The company operates the largest ride-sharing service in the U.S., with a market share of 76%, and the second-largest food-delivery service in the U.S., with a market share of 23%, according to Bloomberg. According to Argus analysts, the model works globally as well. This model creates a lasting economic moat - not only because Uber benefits from the fun network effects, but also because the data generated by its platform allows the company to dispatch and schedule drivers more efficiently. Advertisers can also use this data to target consumers on the platform.

With that in mind, the ride-sharing market is projected to grow at an annualized rate of 16% by 2030, and the online food delivery market is projected to grow at an annualized rate of 19% during the same time period, which puts Uber's annualized sales growth rate at around 10% by the end of this decade, which makes its current valuation of 4.3x sales seem quite reasonable. Patient investors should feel free to buy a small position in this growth stock today.

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John Mackey, former chief executive officer of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors.Trevor Jennewine owns shares of Amazon and Shopify.The Motley Fool owns shares of Amazon, Shopify and Uber Technologies and recommends these companies, The Motley Fool holds stakes in Amazon, Shopify and Uber Technologies and recommends these companies. The Motley Fool has a disclosure policy.

2 Effortless Growth Stocks to Buy Now for $80 and Hold for the Long Term was originally published by The Motley Fool.