Yelp

Yelp is a website that encourages consumers to share feedback on everything from restaurants to churches. By the end of last year, it had amassed over 33 million reviews, up 45% from 2011. The company says these reviews put “word of mouth” online, for the 100 million-plus people who use the site each month. In 2014, those reviews will also start putting profits into Yelp’s bank account. Analysts expect Yelp to earn 22 cents a share in 2014. Yelp’s growth has been phenomenal with the number of businesses paying to do things like advertise, beef up their Yelp pages or respond to reviewers increasing at an unprecedented rate. Analysts expect this kind of growth to continue as Yelp moves into more countries, as more people use the site and move to smartphones and other mobile devices - natural access points for people who like to check Yelp reviews on the fly. Analysts give Yelp great reviews and expect sales of 39% in 2014.

Microsoft

King of tech Microsoft has recently announced its new CEO, Satya Nadella, and under his direction the company faces a ‘fresh start’. For Microsoft, the challenges are obvious: the company has to gain a bigger foothold within the mobile computing industry, as well as keeping the legacy PC industry afloat as long as possible. Undoubtedly, it also has to build a better brand name. The latter objective may be the most important, and the most challenging. Too many consumers view Microsoft with disdain, or worse, apathy, because of past product quality issues and poor product planning. The Xbox brand has a large and loyal following, but gaming has never been a serious profit centre for Microsoft. With a fresh start under a new leader from the outside, will consumers view Microsoft any differently? We think Microsoft is one to watch over the coming year.

Twitter

Trading Twitter is going to be highly volatile and offer plenty of ammo for both the bulls and the bears in 2014. Many analysts believe that Twitter will eventually become the most valuable of all the social media companies, including Facebook. Some are even saying that it will it be the most valuable social media stock. While it is hard to answer whether Twitter will become an increasing threat to Facebook as the latter is obviously strong and diverse enough to stand on its own, growth money will flow from Facebook to Twitter over time. Twitter has at least five distinct revenue streams, perhaps as many as ten. One of the key drivers to the company’s future upside lies in eventual monetisation of its Big Data analysis pipe. This could be the company’s second-biggest revenue driver and also carry the highest gross margins. Twitter feeds Big Data analysis in more verticals and with richer information than any other social media company and thus has a very promising outlook. The stock will likely trade in spike-and-gap moves in both directions for a while and may follow the early path of Google.

FedEx

The transportation sector has long been viewed as a leading indicator of economic activity, and is seen by many as a forecasting tool for the stock market’s direction. For this reason, FedEx is one of the stocks to watch in 2014. FedEx continues to gain market share from its competitors, particularly in the US, making it an even more reliable indicator. Moreover, FedEx is displaying strong technical momentum at this time. Revenues for the company are expected to rise 4% in 2014 about in line with the median forecast for revenue growth of the S&P 500 constituents. Similarly, EPS for FedEx is expected to rise by just over 13% next year, also a near mirror image of the S&P 500 as a whole. From an investment perspective, FedEx has a strong balance sheet and easy-to-understand business model. Revenues and earnings should grow nicely over the next few years and the company has a healthy, growing net cash flow from operations. Heading further into 2014, FedEx should continue to benefit from falling commodity (e.g. gasoline and energy) prices.

Tesla

Skeptics who questioned whether electric car maker Tesla Motors could ever be a real business were left open-mouthed when the company announced it turned profitable without any help from accounting adjustments last year. Sales of its latest car, the Model S sedan, exceeded expectations too with expected 2014 earnings growth predicted to be 606% and sales growth 29%. The Model S also won the Motor Trend Car of the Year award for 2013. Starting in late 2014, Tesla hopes to do the same again by rolling out the Model X, a minivan-SUV crossover. Behind the scenes, the company sells electric vehicle power train components to other car makers, including Daimler AG and Toyota Motor. Tesla is an innovator and unlike other car companies, it owns its dealer network which helps Tesla keep inventory costs down. A great business-model with a bright future!