Why Amazon and Vertex Pharmaceuticals Are Must-Buy Growth Stocks This November

Amazon: The Free Cash Flow Machine with Unmatched Potential

Amazon’s free cash flow has positioned it as an investment powerhouse. Over the past 12 months ending September 30, 2024, Amazon generated a staggering $47.7 billion in free cash flow—a figure that outstrips even the annual revenue of many companies. Year-over-year, this cash flow has skyrocketed by nearly 123%, showcasing Amazon’s impressive operational efficiency and growth potential.

CEO Andy Jassy has made free cash flow Amazon’s primary focus, assuring shareholders that Amazon’s stock price will likely track its cash flow growth in the long run. A significant driver for this growth is Amazon Web Services (AWS), which remains the company’s most profitable segment. With the rise of artificial intelligence, especially generative AI, AWS stands to gain considerably as businesses demand more cloud services for data processing, storage, and analysis.

Amazon’s e-commerce business, while already a global leader, also has significant room for growth. Currently, Amazon holds only about 1% of the global retail market, with the bulk of retail revenue still coming from physical stores. However, as Jassy highlighted, e-commerce is expected to capture a much larger share of global retail in the coming decades, which could further boost Amazon’s revenue.

Amazon is also innovating on cost control. Its investment in advanced robotics has driven down order fulfillment costs, and the company’s generative AI-powered development tools are projected to save $260 million and 4,500 developer hours. With robust cash flow, strong leadership, and continuous innovation, Amazon is well-positioned to deliver consistent, long-term growth.

Vertex Pharmaceuticals: A Profit Powerhouse with Breakthrough Treatments

In healthcare, Vertex Pharmaceuticals has established itself as a top biotech innovator. Expected to bring in nearly $11 billion in revenue this year, Vertex’s growth is fueled by its highly profitable pipeline and an array of groundbreaking therapies. Vertex has become the sole provider of drugs that treat the underlying genetic cause of cystic fibrosis (CF), an achievement that generates strong and consistent revenue. In January, Vertex expects FDA approval for its most advanced CF therapy, the Vanacofactor triple-drug combo, which could further strengthen its CF franchise.

Vertex’s reputation as a pioneer has only grown with the launch of Exa-Cel (Cas9 gene-editing therapy). This breakthrough treatment is the first approved CRISPR gene-editing therapy, specifically for sickle cell disease and transfusion-dependent beta-thalassemia. Many consider CRISPR to be one of the most transformative biotech discoveries of the century, and Exa-Cel offers curative treatment options for rare genetic blood disorders, delivering what many view as a medical miracle.

Vertex’s pipeline also features suzatrigine, a potential game-changer for pain management. This non-opioid drug is currently under FDA review for moderate to severe acute pain treatment, with a decision expected by January 30, 2025. Given the opioid crisis, a successful non-opioid pain reliever could become a blockbuster treatment, adding yet another revenue stream for Vertex.

The company is also developing a groundbreaking islet cell therapy that could offer a cure for type 1 diabetes. This treatment is in early-stage trials, but it holds the potential to address a massive market with an estimated 3.8 million affected individuals globally.

Why Amazon and Vertex Stand Out for Growth-Focused Investors

Both Amazon and Vertex Pharmaceuticals are well-positioned for long-term growth, with innovations that set them apart in their respective sectors. Amazon’s unparalleled free cash flow, bolstered by growth in AWS and e-commerce, makes it a compelling choice for investors looking for consistent, scalable growth. On the other hand, Vertex Pharmaceuticals offers significant upside potential with its pioneering treatments, particularly in cystic fibrosis, gene therapy, and pain management.

For investors focused on growth, Amazon and Vertex Pharmaceuticals provide distinct advantages in sectors with vast market potential, making them standout stocks for November and beyond.