Markets have bullish and bearish cycles, and each cycle presents opportunities for investors. Bull markets are the growth part of the cycle and occur much more frequently than bear markets.
One thing that isn't typical of a bull market is the opportunity to buy top stocks on a dip. Investors need to do careful scouting to find bull market bargains. revolve group (New York Stock Exchange: RVLV) and roblox (NYSE: RBLX) These are today's top two stocks to buy. Here's why:
The future of fashion includes AI
jennifer cybil: Revolve has two sister sites, Revolve and haute couture site FWRD, which offer premium fashion designs for the Millennial and Gen Z markets. Revolve is all-digital and constantly uses artificial intelligence (AI) throughout its business operations, and its rich data gives it greater power to offer customers what they know they want and charge full price. You can get it.
Revolve's core customers are typically willing to spend top dollar on high fashion, but they aren't necessarily wealthy and are currently spending less. Sales in the fourth quarter of 2023 were down 1% year-on-year, and down 3% for the full year. Net income fell 53% for the quarter and 52% for the year.
Although that's depressing, even adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) and net income remained positive.
Meanwhile, Revolve has shown resilience. Although sales are down slightly, inventory is down even further, down 5% from the previous year. As a result, the gross profit margin for the fourth quarter increased for the first time in six quarters. The company focuses on cash efficiency; free cash flow Revenues in 2023 were $39 million, an increase of 114% over the previous year.
Revolve does what it does best: build relationships with loyal customers and generate engagement, and they continue to grow their customer base. The number of active customers in the fourth quarter increased by 9% year over year, and total orders increased by 3%. Average order value decreased 1% year over year. This causes sales to decline as loyal customers continue to use his Revolve but switch to lower cost products under pressure.
The stock is down 72% from its 2021 high. The stock was set to rise quickly when sales growth soared and fall when high inflation hit, but it has weathered this tough period and should reward patient investors who buy today.
Roblox stock is poised for a big comeback
Keith Noonan: Roblox was one of the first companies to make a big move in the Metaverse space, and it remains the clear leader in the category. The company's platform includes thousands of unique games and social experiences. Users can also create their own content on the platform.
By spending real-world money to unlock in-world currencies, creators can build unique games and experiences for others to enjoy. If this content ends up garnering significant engagement from other users, creators can actually earn a lot of cash in the real world.
For example, Roblox paid out $221.8 million to creators on its platform in the fourth quarter of 2023, an increase of 22% year over year. The incentive structure means that new content is constantly added to the platform and popular games and experiences receive significant content updates on a regular basis to maintain user interest.
Combined with the platform's strong online socialization component, this means there's almost always something new and worth watching on Roblox.
In the fourth quarter, Roblox bookings increased 25% year-over-year to approximately $1.13 billion. A portion of gross bookings goes toward paying creators on the platform, resulting in revenue of approximately $749.9 million in the period, representing 30% year-over-year growth. Meanwhile, net operating income increased 20% year over year to $143.3 million.
Strong growth in the fourth quarter was driven by continued expansion of the platform's user base and increases in average spend per user and number of bookings. His average daily active users on Roblox increased by 22% year over year to 71.5 million. In other words, an average of 71.5 million users were logging on to the platform every day.
Thanks to the growing user base, total engagement hours registered on the platform increased by 21% to 15.5 billion hours. His average booking value per daily active user increased 3% year over year to $15.75 in the quarter, allowing the company to record record revenue and bookings.
Roblox stock is still down 74% from its 2021 highs, so the stock looks like a smart buy for growth-focused investors right now.
Should you invest $1,000 in Revolve Group now?
Before purchasing Revolve Group stock, consider the following:
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The bull market is here: Top 2 stocks down 72% and 74% to buy now Originally published by The Motley Fool