2 Cheap Growth Stocks to Watch in 2024

Check out Alimentation Couche-Tard (TSX:ATD) stock and another cheap growth gem in the new year.

| More on:
Money growing in soil , Business success concept.

Image source: Getty Images

Just because the stock markets are starting to get a tad overheated (perhaps overvalued, depending on who you ask) doesn’t mean you can’t continue to do well from here. As a DIY investor who can pick your spots, it can make sense to pay more attention to the less-loved areas of the market for contrarian value opportunities. Indeed, you can find such plays in almost any “type” of market climate.

Typically, certain sectors tend to be more overheated than others. And though it can be painful to watch others continue to gain in stocks that have always tended to look overheated or overvalued, I think it’s far better to be safe than sorry in the investment world.

As a DIY investor, you can stick with value plays and avoid the overly frothy, even bubbly stocks that are likeliest to be the first to fall if the market’s legs begin to wobble.

After last year’s hot run, it’s time to re-focus on cheap growth stocks, ones that can do well over extremely extended periods of time (10-15 years or more). Though they may take some damage if today’s overvalued bubble plays burst, I view the following names as bound to recover and make higher highs in the years that follow.

Without further ado, let’s check out the following growth plays that I believe look nothing short of enticing, even in an uncertain 2024.

Alimentation Couche-Tard

Alimentation Couche-Tard (TSX:ATD) shows us all that you don’t need a front-row seat to the latest, hottest tech trends to clock in enviable returns. The stock has been steadily appreciating in recent years, rewarding the patience of investors who stood by the stock, even amid dire macro forecasts.

Thus far, Couche-Tard has remained robust in the face of a pandemic, inflation, and even global supply chain challenges. Up next, a recession could weigh. But as an incredibly resilient (and convenient) consumer staple, I expect its superb rally won’t be derailed, especially since many investors already have a downturn on their radars. The real upside, I believe, lies in the company’s long-term merger and acquisition strategy. Over the next four-and-change years, Couche-Tard plans to continue its growth.

As the company experiments with fresh food and new in-store layouts, I expect margins (and sales) to trend higher over time as the firm continues to resonate with its customers. Personally, I think fresh foods (think subs) and hot foods (like pizza) are what will draw people into gas (or charging) stations, even if they have no car to fill up! Perhaps an acquisition of a food-focused gas station chain (think Sheetz in the eastern U.S.) could be in the cards between now and 2028.

With an 18.85 times trailing price-to-earnings multiple, I continue to view Couche as a discounted growth stock to stash in a TFSA for 10-20 years!

Salesforce

Another growth play that’s easy to overlook is Salesforce (NYSE:CRM), the tech firm run by the legendary Marc Benioff. The stock’s been on a run of late, surging over 81% in the past year, thanks in part to better-than-expected numbers and new artificial intelligence innovations.

In the new year, I think Salesforce can power even more gains as it proves to the world it does have the AI prowess to compete with the likes of the very best in the industry. Stick with Benioff, and I think the long-term rewards could have the potential to be great!

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Joey Frenette has positions in Alimentation Couche-Tard and Salesforce. The Motley Fool has positions in and recommends Alimentation Couche-Tard. The Motley Fool recommends Salesforce. The Motley Fool has a disclosure policy.

More on Investing

question marks written reminders tickets
Stocks for Beginners

Where Will Aritzia Stock Be in 3 Years?

Aritzia (TSX:ATZ) stock may have come down from all-time highs, but a new CEO and renewed U.S. focus makes it…

Read more »

edit Sale sign, value, discount
Investing

The Market Is Being Too Hard on These Growth Stocks Going for a Discount

These three growth stocks look like excellent buys, given their higher growth prospects and discounted stock prices.

Read more »

Retirement plan
Investing

3 Stocks I’m Adding to my Retirement Account in March

Well Health Technologies, Cineplex, and Fortis each have their own strengths that make them good buys for retirement planning.

Read more »

A red umbrella stands higher than a crowd of black umbrellas.
Investing

Worried About a Market Collapse? Here Are 2 Stocks That Could Beat a Bear Market

Stocks have risen at a fast rate in 2024. Are you worried about a sudden market collapse? Here are two…

Read more »

stock research, analyze data
Dividend Stocks

Is it Too Late to Buy Dollarama Stock?

Dollarama (TSX:DOL) stock is up almost 200% from its 2020 lows. Is it still a buy?

Read more »

data analytics, chart and graph icons with female hands typing on laptop in background
Dividend Stocks

Down by 25%: Is Canadian Tire Stock a Buy in February 2024?

Take a closer look at this Canadian retail stock if you are looking for low-cost additions to your self-directed portfolio…

Read more »

Golden crown on a red velvet background
Dividend Stocks

Cash Kings: The Top 2 Canadian Stocks That Pay Monthly

Two Canadian stocks are cash kings to income investors for their generous dividends and monthly payouts.

Read more »

Dice engraved with the words buy and sell
Bank Stocks

Royal Bank of Canada: Buy, Sell, or Hold After Solid Q1 2024 Earnings?

Royal Bank is up more than 20% from the 12-month low. Are more gains on the way?

Read more »