After a rotation into value stocks earlier this year, growth stocks have rebounded and are showing bullish momentum due to a strong economy and the transitory nature of inflation, which is why investors should consider growth stocks such as HCA Healthcare, Inc. (NYSE:HCA), Zebra Technologies Corporation (ZBRA), and Dillard's, Inc. (NYSE:DDS).Unless you're a very conservative investor, allocating at least a part of your portfolio to growth stocks is a smart idea. Growth stocks provide investors with the potential for solid gains. While many retreated late last year as we saw a rotation into value stocks, growth stocks have come roaring back.
Since March 8th, the SPDR S&P 500 Growth ETF (SPYG) has gained over 28%, compared to an 18.4% gain for the S&P 500. As the second-quarter earnings season came to an end, one thing we learned is that many companies are rapidly accelerating their earnings or sales growth. Even as the Delta variant of COVID is wreaking havoc on some states, the economy continues to move along.
The Fed's assertion that inflation is transitory also appears to be correct, which is great news for growth stocks. That's why investors should consider growth companies such as HCA Healthcare, Inc. (HCA), Zebra Technologies Corporation (ZBRA), and Dillard's, Inc. (DDS) that are rated a Buy or higher in our POWR Ratings system.