Sultee says Finance: Top Large cap Stocks to buy may 2023

Happy almost-May everyone! I have plans to release a monthly “stocks to buy” blog, so stay tuned for more! Before going to the big reveal, I think it is important to state my values/thesis for the stock market. I am not a day trader, nor do I value that when trading stocks. Stocks are meant to be purchased and placed on the shelf for at least the next five years. They are not a get rich quick scheme. Therefore, I choose to invest in companies that will be good for the long haul. I also value buying stocks when they present good value (Buy Cheap, Sell High). The rankings you will see below are highly influenced by my own stock analysis and scoring as well as that of industry leaders such as the WSJ, Yahoo Finance, and the Motley Fool.

Large Cap Stocks: May 2023

Maybe this is a review to some folks reading this, but I want to define a large cap stock. Large cap stock are those that possess a market cap over $10B. Basically, these are the companies that you likely experience on a daily basis (Google, Apple, Microsoft, Target, Walmart, etc). Typically these companies will not have a high variance in their stock prices and present a lower risk of loss. The lower your risk tolerance is, the more Large Cap Stocks you will want to invest in.

#1: Paycom

Sorry, I like to show commercials or demos for the products and companies.

What is it?: Paycom is an all-in-one cloud based Human Capital Management system (HCM). Essentially it’s one software platform that offers access to time and labor management, talent acquisition, HR management, and talent management across an organization. They also allow employees to correct payroll mistakes.

Why Buy it? Paycom is continuing to grow even as a $17B market cap company. For Q4 2022 earnings, Paycom announced a 30% growth in revenue YOY, which is it’s 7th straight quarter of over 30% YOY growth!!! In addition, Paycom profit’s are also increasing, raising from 38% EBITDA in Q4 2021 and posted a 44.2% EBITDA in Q4 2022. Bottom line: Paycom is growing it’s revenue and it’s profits, even as the economy has been slowing over this same time period.

SulteeSays Score (0-1): 0.84 (Strong Buy)

#2: Crowdstrike Holdings

What is it? CrowdStrike Holdings provides cybersecurity products and services to stop breaches. It offers cloud-delivered protection across endpoints, cloud workloads, identity and data, and threat intelligence, managed security services, IT operations management, threat hunting, Zero Trust identity protection, and log management. In a world consistently plagued by data breaches and identity theft, cybersecurity is an important industry, and Crowdstrike is the top company in this area.

Why Buy It? Cybersecurity is now essential. Say it with me now: Cybersecurity is now essential. Crowdstrike Holdings and their Falcon product is the leader in cybersecurity. Their customers are satisfied with it (Growth from 57% to 62% of customers adopting 5 or more different modules from 2021 to 2022) and they continue to attract more customers (41% growth in 2023). Their topline revenue grew 54% to $2.2B in 2023. Although there are questions about the YOY revenue slowing, when compared to it’s rivals and peers in the industry, Crowdstrike is a must own stock that will beat the market over the next 3-5 years.

SulteeSays Score (0-1): 0.82 (Strong Buy)

#3: The Trade Desk

What is it? The Trade Desk, Inc. engages in the provision of a technology platform for advertising buyers. It operates through the United States and International geographical segments. The company operates a self-service cloud-based platform that allows buyers to plan, manage, optimize, and measure data-driven digital advertising campaigns across various ad formats and channels, including video, display, audio, digital-out-of-home, native, and social on various devices, such as computers, mobile devices, televisions, and streaming devices. It also provides data and other value-added services.

Why Buy It? The Trade Desk is an extremely young company (established in 2009 after CEO Green left Microsoft) yet is already posting positive net earnings (Q4 EPS: $0.14) and is showing growth (Q4 Revenue Growth of 24%). The Trade Desk has a competitive advantage over any competitors in the analytics it provides to advertisers across platforms.

SulteeSays Score (0-1): 0.82 (Strong Buy)

#4: Masimo

What is it? Masimo  is a global medical technology company that develops and produces a wide array of industry-leading monitoring technologies, including innovative measurements, sensors, and patient monitors.

Why Buy It? I am excited about some recent news around Masimo that is driving up this rating (not just my ratings, but industry ratings as well). Masimo has opened pre-orders for their new ‘Freedom’ smartwatch that will give users more health related detail than the traditional Apple Watch currently does. In addition, Masimo received FDA approval to test its Opioid Overdose Prevention and Alert system, which monitors and alerts if symptoms of an opioid overdose are present. On the business side, Masimo’s healthcare and hardware business continues to grow (healthcare revenue up 8.2% YOY, hardware shipped up 6.2%).

SulteeSays Score (0-1): 0.78 (Strong Buy)

#5: ServiceNow

What is it? ServiceNow is a software company that provides a cloud-based platform for automating IT management workflows. The company specializes in IT Service Management, IT Operations Management and IT business management.

Why Buy It? This company has three things in its favor: positive earnings (Q1 FY23 EPS: $2.04), growing revenue (Q4 FY22 25% YOY growth), and near perfect customer retention rate (98% retention in 2022). Servicenow is also in a very high demand space. Workflows = more efficiency in the workplace = savings for companys.

SulteeSays Score (0-1): 0.76 (Strong Buy)

That’s it! Those are my top 5 large cap stocks to buy for the month of May! Be on the lookout for the top international stocks, mid-cap stocks, and small-cap stocks articles also coming this month!

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