2 Brilliant Growth Stocks to Buy Now and Hold for the Long Term

Exact Sciences and Roku, after significant underperformance, are demonstrating a turnaround, positioning them as potential long-term investments. Exact Sciences is addressing profitability and competition through the launch of its more accurate Cologuard Plus, the acquisition of rights to a blood-based colorectal cancer test, and a large untapped market for cancer screening. Concurrently, Roku reported its first net profit in Q3 with 14% revenue growth, driven by its robust advertising business and increasing user engagement, solidifying its leadership in the expanding connected TV market.

Analysis

Exact Sciences (EXAS) and Roku (ROKU), after a period of significant underperformance, are demonstrating a notable turnaround, positioning them as potential long-term investment opportunities. Both companies have shown resilience and strategic adjustments to address prior headwinds.

Exact Sciences is leveraging its new Cologuard Plus, which offers higher sensitivity and specificity than competitors like Guardant Health's Shield, alongside a 5% lower manufacturing cost, to drive patient and physician adoption within a 55 million-person untapped U.S. screening market. The company's recent acquisition of rights to a blood-based colorectal cancer test further strengthens its competitive stance and long-term growth prospects, despite current unprofitability.

Roku reported strong third-quarter results, with revenue increasing 14% year-over-year to $1.2 billion and achieving its first net profit in a considerable period, delivering $0.16 EPS. This performance is primarily attributed to its robust advertising business, enhanced by initiatives like Ads Manager and a partnership with Amazon, capitalizing on its leading position in connected TV and a 14% increase in streaming hours to 36.5 billion.

Both companies are exhibiting improved financial trajectories and strategic positioning within their respective growth markets. Exact Sciences' product innovation and market expansion, coupled with Roku's ad monetization and connected TV leadership, suggest a more favorable outlook moving forward.

Key Decisions for Investors

• Investors should consider initiating or increasing long-term positions in Exact Sciences and Roku, given their recent operational improvements and significant market opportunities.
• Monitor Exact Sciences' Cologuard Plus adoption rates and the development progress of its acquired blood-based CRC test as key indicators for future profitability and market share gains.
• Watch Roku's continued ad revenue growth, average revenue per user trends, and user engagement metrics to assess the sustainability of its recent return to profitability and market leadership in connected TV.