The past few weeks have seen extreme volatility in the market and the earnings season is usually a highly volatile period. With several companies reporting earnings, it is natural for the market to see ups and downs.

However, it also gives investors a better idea of the right stocks to pick and what to expect from these companies. I am always inclined towards growth stocks since they have the potential to keep moving higher whenever the market improves. While some growth stocks continued their rally this earnings season, many showed challenges on the path ahead. I’ve picked the best growth stocks to buy this September. These stocks are well-established industry players with a strong earnings report and a promising future. They have impressed the market with strong numbers and are on their way to bigger gains. Let’s take a look at them. 

Alphabet (GOOG, GOOGL)

An industry leader, Alphabet (NASDAQ: GOOGL) has become a household name today. Known for Google Search, and YouTube, Alphabet is a leader in the advertising segment and generates maximum revenue from it, up 19% year-to-date and 28% since last August. Alphabet stock is exchanging hands for $167. The stock is lower than the 52-week high of $193 and looks undervalued to me. It has a modest dividend yield of 0.48% and is a tech stock to buy and hold for the next decade. 

In the second quarter, the company saw a 14% year-over-year jump in revenue to $84.74 billion and the net income jumped 29% YOY. Its cloud segment surpassed $10 billion in revenues and $1 billion in operating profit for the first time. With Alphabet’s cloud revenue rising, we could see the stock marching upward. 

Google search revenue jumped 14% YOY while advertising revenue saw a 13% jump and generated $64.62 billion. The cloud revenue soared 29% and it makes up over 10% of the company’s total revenue. Driven by cloud, Alphabet could see its operating profit soar in the coming years. It is currently the third largest cloud computing provider, only behind Amazon (NASDAQ: AMZN) and Microsoft (NASDAQ: MSFT).

When it comes to Google search, no company has been able to take Alphabet’s market share and while there were concerns about ChatGPT impacting its search share, it hasn’t happened yet. CEO Sundar Pichai has stated that the company is investing heavily in artificial intelligence (AI) and could be one of the top AI players in the next few years. GOOG stock has ample space to grow and the company has already shown its strength amid the rising competition in the industry. 

American Express (AXP)

American Express (NYSE:AXP) is a credit card issuer and a payment network that earns steady revenue whenever a user swipes the card. As we transition from cash to digital payments, American Express will continue to grow. Trading at $251, the stock is up 33% YTD and 58% in 12 months.

The company benefits from a wide network effect and this setup allows it to make money in different ways. It earns steady revenue whenever the cards are swiped. Additionally, it earns interest income from the consumers who maintain a balance with American Express. In the second quarter, the company generated $2.1 billion in annual fees and interest income. Its profit came in at $4.15 per share, up 39% YOY and the management raised the full-year outlook.

The revenue increased 8% YOY, driven by an impressive 20% jump in the net interest income. It is aiming for an EPS between $13.30 and $13.80 for the full year. The company is on a strong momentum and is hoping to maintain it throughout the year. American Express is also the preferred choice of millennials and Gen Z with 60% of new accounts opened by them. 

American Express is a premium company that enjoys strong brand loyalty. With a double-sided platform, it enjoys network effects and makes money whether consumers save or spend. Its cards are accepted at 80 million locations and with over 100 million cards in circulation, American Express is in a good position to benefit from digitization.  

This growth stock will appeal to dividend investors for its 1.11% dividend yield and it tries to boost the payout each year. 

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Taiwan Semiconductor (TSM)

A solid growth stock, Taiwan Semiconductor (NYSE: TSM) is set to benefit from the increased AI spending. As companies pour money into the AI sector, Taiwan Semiconductor will see higher growth and profits. A hot stock today, TSMC is up 60% YTD and 72% over the 12 months. Trading for $949, it is a stock split candidate. 

Several catalysts are working in favor of the company which is set to invest €5 billion in a German semiconductor plant to reduce its dependency on China. TSMC makes chips for the biggest tech giants across the world including Nvidia (NASDAQ: NVDA), and Advanced Micro Devices (NASDAQ: AMD). Hence, whenever Nvidia grows, TSMC is set to benefit. Its biggest customer Apple (NASDAQ: AAPL) designs its own chips and TSMC manufactures them. 

It shouldn’t be surprising that the company has solid fundamentals. Its revenue came in at $20.82 billion, up 40% YOY, and the net income jumped 36.3% YOY. As long as there is an imbalance in the demand and supply of AI chips, Taiwan Semiconductor will see growth. It makes 3-nanometer chips currently and will begin mass production of 2-nanometer chips next year. Its 3/5 nodes are set to generate $31.02 billion in total revenue in the first three quarters. 

For the third quarter, the company is aiming for revenue in the range of $22.4 billion and $23.2 billion. Taiwan Semiconductor is one of the best AI stocks to own for its potential to grow amid the massive AI industry. 

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