The article delves into the strategic prowess of the trio, unlocking the potential of the stock market giants poised for a future beyond 2025. These industry titans exhibit robust strategies and resilience in diverse markets, navigating challenges while capitalizing on high-growth sectors. This has led to stocks with momentum to buy.
Each company sets a trajectory for long-term success, from the first one’s diversified market presence to the second’s sustainable initiatives to the third’s network dominance.
Similarly, the first one’s strategic divestment and technological investments position it as an adaptable frontrunner. While the second’s focus on eco-friendly solutions aligns with evolving market demands. Lastly, the third’s expansion plans and financial metrics underscore its market leadership ambitions.
As economic landscapes evolve, these giants stand poised to deliver sustained growth, profitability, and value creation for stakeholders.
Jabil (JBL)
To begin with, Jabil’s (NYSE:JBL) market positioning across diverse sectors is a key driver of its growth. It operates across diversified end markets, including renewable energy infrastructure, electric vehicles (EVs), AI-driven cloud data centers, healthcare, digital print, and retail. It allows Jabil to mitigate risks associated with market cyclicality and economic fluctuations.
It is evident from its expected revenue growth of more than 20% in industrial sectors and robust projections in the automotive and healthcare segments. Similarly, the company focuses on understanding and meeting customer needs. It is evident in its capability to support various leading automotive original equipment manufacturers in the electric vehicle market and provide comprehensive design-to-dust capabilities for cloud solutions. All in all, it’s one of those stocks with momentum to buy.
Strategically, Jabil’s decision to divest the mobility business to BYD Electronics (OTCMKTS:BYDIY) for $2.2 billion underscores Jabil’s strategic foresight. This move allows the company to focus on high-growth sectors while optimizing its portfolio for maximum efficiency and profitability. Further, Jabil’s investments in emerging technologies such as EVs, renewable energy, AI cloud solutions, and healthcare exhibit its adaptability to evolving market trends. These investments position the company as a frontrunner in industries with significant growth potential.
Despite economic challenges, Jabil maintains an optimistic outlook for FY’24. It is projecting revenue from $33 billion to $34 billion. The company anticipates a core operating margin expansion of 30 to 50 basis points year-on-year, indicating sustained growth. Finally, the company’s projection for FY ’25, excluding Mobility and considering the impact of accelerated share repurchases, forecasts core operating margins at or above 5.6%, signaling sustained growth and value creation for shareholders.
Marathon Petroleum (MPC)
Fundamentally, Marathon Petroleum’s (NYSE:MPC) capital allocation strategy prioritizes sustaining the asset base, paying competitive dividends, and focusing on earnings growth while maintaining rigorous capital discipline. The company adheres to a consistent framework that accentuates shareholder value maximization while ensuring sustained growth and profitability.
Additionally, Marathon Petroleum is focused on environmental sustainability through significant investments in low-carbon initiatives. It’s actively involved in developing renewable fuel facilities like the Martinez Renewables fuel facility and the Dickinson renewable diesel facility. These facilities are anticipated to produce millions of gallons of renewable diesel annually.
Beyond fuel facilities, the company is engaged in ventures related to low-carbon-intensity RNG and other small-scale projects. These endeavors align with Marathon Petroleum’s goal of reducing the carbon footprint of its operations and products, catering to an evolving market demand for eco-friendly solutions.
Marathon Petroleum has consistently demonstrated high refinery utilization rates, operating at 94% capacity, and exhibits effective commercial performance despite market fluctuations and occasional refinery downtime. The company manages disruptions adeptly, strategically planning repairs and turnaround activities to minimize operational impacts and ensure sustained efficiency and productivity. This makes it one of those stocks with momentum to consider.
Lastly, MPLX, as part of Marathon Petroleum’s portfolio, plays a strategic role by covering Marathon Petroleum’s dividend and a substantial portion of the company’s planned 2023 capital program. The company anticipates MPLX’s growth to facilitate increased cash distributions to Marathon Petroleum, showcasing the potential for mutual growth.
Overall, Marathon Petroleum actively seeks and capitalizes on growth opportunities. It emphasizes high-return projects anchored in key basins like the Marcellus and Permian. These initiatives align with the company’s strategy of sustained expansion and profitability.
Cogent (CCOI)
Cogent’s (NASDAQ:CCOI) network infrastructure and market leadership position it favorably for sustained growth and market dominance. As of Q3 2023, with a presence in 1,588 carrier-neutral data centers, Cogent holds a strong position in providing connectivity services. Its expansion plans, targeting 100 carrier-neutral data centers annually, indicate its ambition for market leadership.
Furthermore, the introduction of wavelength services and expansion plans to cover more carrier-neutral data centers affirm Cogent’s focus on technological advancements and cater to evolving market demands.
In detail, the company’s annualized revenue run rate exceeding $1 billion showcases substantial revenue growth stemming from the acquisition. The addition of numerous enterprise customers from Sprint further supports this growth. It is broadening the company’s revenue streams and diversifying its client portfolio.
As a result, Cogent’s financial metrics exhibit notable improvements post-acquisition. At the bottom line, the adjusted EBITDA surged to a record 47.7%, reflecting enhanced profitability and operational effectiveness. The company’s debt ratios improved significantly, indicating better financial leverage and stability.
On the other hand, the company’s consistent track record of sequentially increasing quarterly dividends reflects its confidence in sustained cash flow generation. Cogent’s manageable debt levels and improved leverage ratios empower it to pursue shareholder-friendly activities like dividends and potential buybacks.
Finally, the company’s guidance outlines expectations for long-term average revenue growth between 5% and 7% per year, accompanied by EBITDA margin expansion. Overall, these multi-year goals underline Cogent’s strategic planning and confidence in its ability to navigate future market challenges. It’s definitely one of those stocks with momentum you should consider buying.
On the date of publication, Yiannis Zourmpanos did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.