The following securities represent U.S. publicly traded companies that have increased their spending on the purchase of property and equipment substantially over the past five years. This may anticipate higher revenues, as these companies likely expect higher demand for their products in the near future.
The earnings per share of these stocks are also predicted to increase significantly, according to Wall Street analysts.
JD.com Inc
The first company under consideration is JD.com Inc (JD, Financial).
The Chinese e-commerce company has increased its allocations to the purchase of property and equipment over the past five years largely, passing from nearly $230 million in full-year 2014 to $373.1 million in full-year 2019.
Wall Street sell-side analysts forecast that JD.com Inc will increase its EPS by 57% next year and 53.8% every year over the next five years, while the S&P 500, which is the benchmark for the U.S. market, is predicted to post growth rates of 20% and 5%, respectively.
Wall Street recommends a buy rating for this stock with an average target price of $49.38 per share.
The share price has risen by 49.4% in the past year to $44.60 at close on April 15 for a market capitalization of $61.64 billion.
The stock has a price-earnings ratio of 35.13 versus the industry median of 12.57, a price-book ratio of 5.38 versus the industry median of 0.95 and a price-sales ratio of 0.75 versus the industry median of 0.4.
The Trade Desk Inc
The second company under consideration is The Trade Desk Inc (TTD, Financial).
The Ventura, California-based operator of a self-service cloud-based platform has increased its allocations to the purchase of property and equipment over the past five years. It spent $35.7 million in full-year 2019 compared to the much smaller amount of $832,000 spent in full-year 2014.
Wall Street analysts estimate that The Trade Desk Inc will increase its EPS by 33.1% next year and 31% on average every year over the next five years.
Wall Street recommends an overweight rating for this stock with an average target price of $243.33 per share.
In the past year, the stock price has grown 14%, closing at a price of $226.56 per share on April 15 for a market capitalization of $10.33 billion.
The stock has a price-earnings ratio of 100.69 versus the industry median of 20.65, a price-book ratio of 17.77 versus the industry median of 2.38 and a price-sales ratio of 16.4 compared to the industry median of 1.76.
Crexendo Inc
The third company under consideration is Crexendo Inc (CXDO, Financial).
The Tempe, Arizona-based provider of information technology services has grown its allocations to capital spending largely over the past five years. The company invested about $72,000 in full-year 2019 compared to the $8,000 spent in full-year 2014.
Wall Street recommends a buy rating for this stock with an average target price of $6 per share.
Over the past year, the share price has risen by 53.33%, closing at $4.60 on April 15 for a market capitalization of $68.54 million.
The stock has a price-earnings ratio of 65.7 versus the industry median of 20.65, a price-book ratio of 16.65 versus the industry median of 2.38 and a price-sales ratio of 4.92 compared to the industry median of 1.76.
Disclosure: I have no positions in any securities mentioned.
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