2 Unstoppable Growth Stocks to Buy Right Now for Less Than $500

It's not always easy to be a long-term investor. The markets have been particularly volatile over the last few years. While investors have responded favorably to slowly decelerating inflation rates and the recent Fed cut, not to mention a prolonged bull market, not all stocks are responding the same way.

Few stocks will make investors rich overnight, and timing the market rarely works consistently. If you're looking to build a profitable portfolio and sustain that growth with time, long-term investing remains the most beneficial strategy.

Investing consistently in both market highs and lows, investing in businesses rather than simply share prices, and understanding the underlying business are key principles to consider here. You should also invest in companies that align with your overall personal investing philosophy and risk tolerance levels.

If you're searching for more stocks to add to your portfolio this month, here are two quality businesses to consider that could be a shrewd use of a $500 or more investment.

1. Veeva Systems

Veeva Systems (NYSE: VEEV) is a leading provider of cloud software solutions for life sciences companies worldwide. At the time of this writing, shares of the company are up around 10% so far in 2024, around half of the S&P 500's return over the same time frame. While that performance is not necessarily enough to write home about, it's not because Veeva has experienced any alarming business developments.

The company is steadily growing revenue, is extremely profitable, and has an ever-growing cash position. In fact, it provides various software, data, and business consulting services to some of the biggest names in the life sciences and healthcare industries. Its clients include companies like Sanofi, GSK, Novo Nordisk, Bayer, and Eli Lilly.

These software solutions enable everything from streamlining research and development processes to driving commercialization initiatives and even government compliance. Veeva Systems' software suite also helps life sciences companies plan and execute quality, clinical, and regulatory processes to safely and seamlessly bring products to market.

For example, its Veeva Development Cloud platform helps clients do everything, from transmitting key data, to clinical trial stakeholders, to managing important documents and helping sponsors design, and run trials. Its Veeva Commercial Cloud offering includes a variety of solutions, such as helping sales representatives optimize engagement with healthcare providers or managing sales and marketing for new products.

Veeva Systems makes the vast majority of its revenue from recurring subscriptions that life sciences companies pay to access its software solutions. A smaller fraction of the revenue comes from professional services like training and data services. In the company's fiscal year 2024 (ended Jan. 31, 2024), subscription services accounted for 80% of total revenues.

Fast-forward to now and the company's most recent financial report for the second quarter of its fiscal 2025. Veeva Systems reported total revenue of $676.2 million, up 15% from one year ago. Subscription services accounted for $561.3 million of that total, a 19% year-over-year increase.

The company also generated profits of $171 million according to generally accepted accounting principles (GAAP), up a whopping 53% from one year ago. Veeva Systems ended the quarter with $1.2 billion in cash and cash equivalents on its balance sheet, compared to $703.5 million at the end of the prior quarter.

At around $206 per share, the company currently trades at a trailing price-to-earnings (P/E) ratio of 54.5, although its price-to-sales (P/S) ratio is a far more moderate 13. While this suggests that near-term growth might be priced into the stock, Veeva Systems has a lot of room to run, given the customers it serves and the essential services it provides to them. Investors looking at a three- to five-year investment might find that the stock warrants at least a second look, if not a starter position.

2. Chewy

Chewy (NYSE: CHWY) trades for around $30 a share at the time of this writing, but the stock is up around 65% from its position just one year ago and 36% from the beginning of 2024. The pet e-commerce platform has expanded its business considerably over the last few years. While it sells thousands of products on its flagship platform, including its own private-labeled brands, this is just one piece of the pie for Chewy's long-term growth story.

The company has an online pharmacy, including compounding services for pet and animal owners and its own on-demand vet telehealth service. Chewy offers a range of pet health insurance plans for shoppers and even launched a sponsor ads program recently that allows select brands to advertise to users on the platform.

While product sales still comprise the majority of Chewy's top- and bottom-line figures, these more diverse revenue streams can contribute to the longer-term growth story for this business. For example, the company expects its sponsored ads program to contribute 1% to 3% to total net sales by the end of 2024.

One of Chewy's most notable business developments is its decision to open brick-and-mortar vet locations. Management sees this as interrelated to, not separate from, its much larger e-commerce business. The company has already opened six Chewy Vet Care clinics in 2024.

Not only has the cohort of net new customers gained through these clinics outpaced management's prior expectations, but clinic foot traffic is also encouraging users to spend more on veterinary services on the whole and the products that Chewy offers through its e-commerce platforms. Chief financial officer David Reeder noted in the recent earnings call that roughly half of the customers who have visited its clinics have then placed orders on Chewy.com.

In Chewy's Q2 2024, net sales totaled $2.9 billion, up 2.6% from one year ago. While that growth rate was moderate, its bottom line surged by an astounding 1,380% to $299.1 million. One year ago, it reported net income of just $20.2 million.

Chewy's Autoship program accounted for 78% of all net sales in Q2, and spending on healthcare and non-discretionary categories comprised a whopping 85% of customer spending. This means Chewy is making most of its money from recurring sales on essential items. Chewy has a lot to execute on over the next three to five years, but long-term investors might find the wait worth it.

Should you invest $1,000 in Veeva Systems right now?

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Rachel Warren has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Chewy and Veeva Systems. The Motley Fool recommends GSK and Novo Nordisk. The Motley Fool has a disclosure policy.