With the recent Fed rate cut, slowly easing rate of inflation, and general optimism for economic growth, U.S. businesses are showing signs of strong growth prospects. Thus, it might be an opportune moment to seek high-growth stocks.
With these economic drivers in mind, investors could look into shares of growth stocks Esperion Therapeutics, Inc. (ESPR), AngioDynamics, Inc. (ANGO), and Fathom Holdings Inc. (FTHM). All three stocks are priced under $10, and Wall Street analysts see substantial upsides in them.
The Federal Reserve cut its key interest rate by a quarter-point this month in response to the steady decline in the once-high inflation. A historic half-point reduction in September preceded this rate cut. The benchmark rate sits around 4.6% right now, down from a four-decade high of 5.3%.
These rate cuts mainly aimed to combat inflation and reduce borrowing costs for consumers and businesses alike. Inflation has since fallen from a 9.1% peak in mid-2022 to a three-and-a-half-year low of 2.4% in September. As inflation eases, the economy gets another chance to start thriving again.
The Fed plans to cut the rates once more this year and around four times in 2025 to bring inflation closer to its 2% target. However, with the economy mostly solid and Wall Street anticipating faster growth, further rate cuts may become less likely.
In this dynamic environment, growth stocks stand out for their above-average revenue growth, with companies frequently reinvesting profits to drive future expansion, making them a compelling choice for long-term investors.
Now, let us dive deep into the fundamentals of three growth stocks.
Esperion Therapeutics, Inc. (ESPR)
ESPR is a pharmaceutical company that focuses on developing and commercializing medicines for patients suffering from elevated low-density lipoprotein cholesterol (LDL-C). Its offerings include NEXLETOL, NEXLIZET, NILEMDO, and NUSTENDI.
On May 22, ESPR and Daiichi Sankyo Europe GmbH announced the approval of NILEMDO® and NUSTENDI®, the European Commission (EC), for treating hypercholesterolemia and reducing the risk of adverse cardiovascular events. ESPR is set to have a significant presence in the European drug market for treating cardiac diseases and enabling newer revenue streams for the company.
For the fiscal 2024 third quarter ended September 30, ESPR’s total revenues increased 52% year-over-year to $51.63 million. As of September 30, 2024, the company’s cash and cash equivalents stood at $144.72 million, compared to $82.25 million on December 31, 2023.
Moreover, ESPR’s total assets stood at $314.11 as of September 30, 2024, compared to $205.80 on December 31, 2023.
Analysts expect ESPR’s revenue for the fiscal year ending December 2025 to increase 31.3% year-over-year to $427.99 million. Moreover, its EPS for the same period is expected to increase significantly to $0.20. Moreover, the company topped the consensus revenue and EPS estimates in three of its four trailing quarters.
Over the past three years, ESPR’s revenue and total assets have grown at CAGRs of 59.6% and 11.7%, respectively.
Shares of ESPR have surged 23.9% over the past three months and 135.9% over the past year to close the last trading session at $2.23.
Based on four Wall Street analysts offering 12-month price targets for ESPR in the last three months, the average target price is $7.76, indicating a 248% upside from the last price.
ESPR’s robust fundamentals are reflected in its POWR Ratings. The stock has an overall rating of B, which translates to a Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, each weighted to an optimal degree.
ESPR has a B grade for Growth, Value, and Quality. It is ranked #46 out of 332 stocks in the Biotech industry.
Click here to access ESPR’s ratings for Stability, Momentum, and Sentiment.
AngioDynamics, Inc. (ANGO)
ANGO is a medical technology company that designs, manufactures, and sells medical, surgical, and diagnostic devices for vascular access, peripheral vascular disease treatment, oncology, and surgical settings. Its products include oncology products like Model 1500X RF Generator, Alatus, VenaCure EVLT 1470 Pro Laser, etc.
On May 21, ANGO announced the European CE Mark approval of its AlphaVac F1885 System for the non-surgical removal of thrombi or emboli from the pulmonary arteries and the treatment of pulmonary embolism (PE). This approval broadened ANGO’s reach into the European markets and established the company as one of the market leaders in the treatment of PE.
For the fiscal 2025 first quarter that ended on August 31, 2024, ANGO’s net sales came in at $67.49 million. Its gross profit was reported to be $36.72 million.
Street expects ANGO’s revenue to increase 7.7% year-over-year to $305.80 million for the fiscal year ending May 2026. Moreover, the company has surpassed consensus EPS estimates in three of its four trailing quarters.
Over the past three years, the company’s tangible book value has grown at a 22.6% CAGR over the past three years. ANGO’s shares have gained 14.2% over the past six months and 16.9% over the past nine months, closing the last trading session at $6.99.
Based on three Wall Street analysts offering 12-month price targets for ANGO in the last three months, the average target price is $13, indicating an 86% upside from the last price.
ANGO’s fundamentals are mirrored in its POWR Ratings. It has a B grade in Growth and Sentiment.
ANGO is ranked #81 out of 137 stocks in the Medical - Devices & Equipment industry.
Click here to access ANGO’s ratings for Value, Momentum, Stability, and Quality.
Fathom Holdings Inc. (FTHM)
FTHM offers a technology-driven real estate services platform for residential brokerage, mortgage, title, insurance, and Software as a Service to brokerages and agents through its cloud-based software, intelliAgent. The company’s three operational segments include: Real Estate Brokerage; Mortgage; and Technology.
On November 4, FTHM announced the acquisition of My Home Group, a leading Arizona-based brokerage ranked 27th in the nation by transaction volume. The acquisition expands Fathom's market reach, strengthens its agent network, and supports its commitment to delivering comprehensive real estate solutions nationwide.
For the fiscal 2024 third quarter that ended on September 30, FTHM’s total revenue came in at $83.73 million. As of September 30, 2024, FTHM’s cash and cash equivalents were reported to be $13.10 million, compared to $7.40 million on December 31, 2024.
The consensus revenue estimate of $408.92 million for the fiscal year ending December 2025 reflects a year-over-year rise of 25.6%.
Over the past five years, the company’s revenue and total assets have grown at CAGRs of 27% and 91.8%, respectively. FTHM shares have gained 36.2% over the past six months, closing the last trading session at $1.92.
Based on two Wall Street analysts offering 12-month price targets for FTHM in the last three months, the average target price is $3.75, indicating a 95.3% upside from the last price.
FTHM’s sound prospects are projected in its POWR Ratings. It has a B grade for Growth.
FTHM is ranked #32 out of 46 stocks in the Real Estate Services industry.
Click here to access FTHM’s ratings for Value, Stability, Quality, Momentum, and Sentiment.
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ESPR shares were trading at $2.19 per share on Thursday afternoon, down $0.04 (-1.79%). Year-to-date, ESPR has declined -26.76%, versus a 26.35% rise in the benchmark S&P 500 index during the same period.
About the Author: Anushka Dutta
Anushka is an analyst whose interest in understanding the impact of broader economic changes on financial markets motivated her to pursue a career in investment research.
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