3 Stocks at all-time highs you should buy without hesitation

Stocks that can double

The market has flirted with new highs in the past week. Even though this is exciting for investors, it can keep many from buying or adding to great stocks. With that in mind, we asked three contributors to The Motley Fool to each name a company they would buy without hesitation, no matter how high the share prices were.

They named us Upstart Holdings (WKN: A2QJL7), Qualcomm (WKN: 883121) and Atlassian (WKN: A2ABYA).

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Upstart Holdings: using AI to turn lending on its head

Danny Vena (Upstart Holdings): Consumer lending has long been ripe for upheaval. Those whose credit is less than perfect are at the mercy of lenders and must pay ridiculously high interest rates – if they can get a loan at all. Even worse, some consumers have low credit scores through no fault of their own because of relationship breakdown, health problems, or simply no credit history. This is where Upstart Holdings comes in.

The fintech company offers an alternative to the rules-based lending systems used by many banks and financial institutions. Instead of considering just a few variables, Upstart uses a novel approach that harnesses the power of artificial intelligence (AI) to find more than 1.000 variables to consider in predicting the likelihood that a loan will be repaid. The company's sophisticated algorithms turn conventional lending on its head, ensuring that many more potential borrowers get a loan while receiving lower interest rates than many borrowers elsewhere.

Upstart's state-of-the-art platform incorporates a whole range of loan default prediction factors, including income fraud, loan stacking, fee optimization, identity fraud, targeted acquisition, prepayment prediction and time-limited default prediction – among many other indicators. Upstart's system gets smarter with each new loan, and with a rapidly growing data set that includes more than 10.5 million repayments, its predictive power continues to expand.

The likelihood of getting a loan is much higher when using Upstart's financial models: 27% more borrowers get a loan from banks using the system than those using traditional lending methods. Not only that, but they tend to get better terms, as the APR (annual percentage rate) on approved loans is 16% lower on average.

None of this would matter if the loans weren't repaid, but financial institutions using Upstart's platform have reduced their loss rates by 75%, for the same number of loan approvals. This shows that the AI-based system is working, and banks are increasingly getting on board.

Upstart's second quarter revenue increased to $194 million, or 1.018 % more than year-on-year. The company has transformed from a loser to a winner, with net income of 37.3 million. US dollar, compared with a loss of 6.2 million. US dollars in the year-ago quarter. Perhaps more importantly, Upstart has turned a profit in every quarter since its IPO late last year.

Robust customer measures contributed to Upstart's financial results. Bankers who use Upstart's system have to pay 286.864 loans 2.8 billion. U.S. dollars awarded, which is 1.Up 605% year over year, and conversion rate increased from 9% to 24%.

Upstart has made it to a huge market of 92 billion. U.S. dollars of unsecured loans aside, but that's not all. The company is expanding its tools to address the auto loan, credit card and mortgage markets, bringing its capabilities to $4.3 trillion. By comparison, Upstart expects to generate $750 million in revenue this year, which illustrates the size of the opportunity.

Qualcomm: An upgrade cycle spurs this dominant 5G chipset company

Will Healy (Qualcomm): Qualcomm's portfolio of wireless patents has made it one of the industry's big players. The company makes chips for a variety of mobile products and could develop a new operating system for cars.

However, many investors associate the company with its chipsets for smartphones, a market that has become increasingly important as the 5G upgrade has taken hold. Although companies like Apple have tried to compete with Qualcomm, right now every 5G device relies on a Qualcomm chip to provide the service. That's a good outlook for Qualcomm, as Grand View Research forecasts that this chip market will grow at a compound annual growth rate of 69% through 2028.

In addition, the company must continue to defend itself against challenges. Qualcomm is heavily dependent on chips from Arm Holdings, a company Nvidia is in talks to acquire. However, with regulators raising antitrust concerns about such an acquisition, it seems increasingly likely that Qualcomm will avoid reliance on Nvidia.

Qualcomm's strength is also reflected in its recently released fiscal 2021 numbers. During this period, Generally Accepted Accounting Principles (GAAP) revenue increased 43% compared to fiscal 2020 to nearly 34 billion. US Dollar. Revenue growth slightly outpaced operating expense growth, and Qualcomm benefited from additional income from capital expenditures and lower interest costs. This resulted in a GAAP net gain of. U.S. dollars for the fiscal year, a 74% year-over-year increase.

Also, slowing growth may not impact Qualcomm as much as it appears. GAAP revenue growth in the fourth quarter slowed to 12%, but revenue increased 43%, excluding the $1.8 billion comparison with Huawei in the fourth quarter of 2020. 10 to 10.8 billion forecast by the company for the first quarter of 2022. However, U.S. dollars represent a 26% year-over-year increase, so Qualcomm will likely face a slowdown for a while.

Although the stock is trading at about the same level it was a year ago, it has risen about 20% since its short-term low in mid-October. In addition, with a price-earnings ratio of only 17, it is still significantly cheaper than comparable companies such as Apple with a profit multiple of 27 or NXP Semiconductor with a price-earnings ratio of 59. As Qualcomm dodges another competitive threat, its important role in the 5G upgrade cycle and low P/E could make the company increasingly attractive.

Atlassian: team collaboration will never go out of style

Brian Withers (Atlassian): Without good collaboration between team members, projects don't get done these days. With remote work and a growing trend toward workers with specialized skills, teams today face the challenge of keeping everyone on task to complete important projects. Software tools are a must in today's business world to coordinate teams that can work from almost anywhere. This is where Atlassian comes in. Atlassian's mission is to help teams around the world reach their full potential. With its focused mission, exceptional metrics and a world of opportunity ahead, this company is a solid bet no matter what the market does.

Let's first take a look at the company's recent results. Customers flock to Atlassian's broad platform of software tools. The company posted a record 216 in the most recent quarter.500 customers, up 30% from the previous year. Revenues are also at a record high of $614 million in the last quarter, up 10% from the previous quarter and 33% from a year ago. As the company moves more customers to its cloud-based tools, it's exciting for investors to see the growth of cloud offerings accelerate.

Key figure Q1 2021 Q4 2021 Q1 2022 Change (quarterly comparison) Change (year-on-year)
Customers 166.180 204.754 216.500 6 % 30 %
Sales 460m. USD 560 million. USD 614 million. USD 10 % 33 %
Growth cloud products (year-on-year) 37 % 47 % 53 % 5 % 16 %

DATA SOURCE: Company quarterly report

These results are excellent, but investors are always eager to see what comes next. Atlassian is well poised to grow in three focus areas. The first is agile development, which is built on top of the company's collaboration tools for software development teams. Given the boom in software development, this area will continue to be a prolific source of growth in the coming years.

The second growth area is helping IT teams release software. As working from anywhere becomes the norm, users demand access to critical software tools whenever and wherever they work. Atlassian's Jira Service Management and Halp give IT teams all the tools they need to meet increased user demands. Work management tools are the third source of growth for the company. These products help teams across all functions juggle tasks and collaborate to achieve their team's goals.

Atlassian's stock has more than doubled in the last twelve months and has experienced a huge upswing. But investors have not missed the boat. I would buy the stock of the company specialized in team collaboration software, led by a founder, without hesitation in any market.

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This article reflects the opinion of the author, which may differ from the "official" recommendation position of a premium advisory service of The Motley Fool. We are mixed! Questioning an investment thesis – even our own – helps us all think critically about investments and make decisions that help us become smarter, happier and richer.

Brian Withers owns shares of Atlassian. Danny Vena owns shares of Apple, Atlassian, Nvidia and Upstart Holdings, Inc. Will Healy does not own any of the stocks mentioned.

This article was written in English and published on 07.11.2021 on Fool.com published. It has been translated so that our German readers can participate in the discussion.

The Motley Fool owns and recommends shares of Apple, Atlassian, Nvidia, Qualcomm, and Upstart Holdings, Inc. The Motley Fool recommends NXP Semiconductors and recommends the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple.

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