5 Growth Stocks to Turn $50,000 Into $100,000
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When you think of stocks that can double your money, what comes to mind?
Tech investors might immediately consider high-growth unicorns. Rocketing startups like Uber Technologies (NYSE:UBER) and Airbnb (NASDAQ:ABNB) can turn small seed investments into billions.
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On the other hand, some quant-based investors will point to over-the-counter (OTC) stocks. Shares in these off-exchange listings can trade for a penny or less, making 100% returns easier to achieve. According to data from Thomson Reuters, 433 OTC listings have already doubled this year.
Profiting from these tech unicorns, however, is usually limited to a handful of individuals. Early stage investing requires significant personal connections to the venture capital world. The first 5,000% returns in Uber came before the stock went public in 2019. Its publicly available stock has only risen 50% since.
And profiting from OTC stocks usually involves becoming a high-frequency trader or market maker. Volumes can be so thin that even listing 1,000 shares of a 1-cent stock (i.e., $10) could raise the market “price” of an OTC listing and cause slippage.
So, where should regular investors seek these multi-bagger returns that can actually turn a $50,000 investment into $100,000?
The answer is relatively straightforward: Investors need to seek 1) moderately fast-growing firms at 2) cheap valuations. In 2023, the 88 companies of the broad-based Russell 3000 Index doubled in price were
Faster growing. “Doublers” had 15.8% expected sales growth vs. 10.6% average.
Cheaper. These firms traded at 11.7 times forward earnings vs. 15.3X average.
These included companies like SkyWest (NASDAQ:SKYW), a low-cost airline, and Affirm Holdings (NASDAQ:AFRM), a buy now, pay later provider. The pattern also holds in other years.
In other words, you don’t need to be a venture capitalist or a Wall Street elite to double your money in a year. If you have a nose for good value, there’s a good chance you’ll run across these 100% upside stocks in your everyday life.
And to get you started, the writers at InvestorPlace.com, our free news site, dive this week into five “100-percenter” stocks that they feel have this potential…
5 Growth Stocks to Turn $50,000 Into $100,000: Albemarle (ALB)
Source: IgorGolovniov/Shutterstock.com
Albemarle (NYSE:ALB) is the lowest-cost lithium producer in the world. It’s moderately fast-growing; management expects volumes mined to increase over 30% next year. And a sudden decline in lithium prices this year has priced the firm squarely in the “100-percenters” category.
As Ian Cooper writes this week for InvestorPlace.com:
The industry’s 800 lb. gorilla had plunged to a low of $123.38 on Nov. 29. It was also trading at six times earnings at the time, I noted, and at less than half of growth. None of which was sustainable.
Since then, ALB bounced back to about $128 and could refill its bearish gap around $170.
Together, that means Albemarle trades at a wide discount to growth. Shares are priced at 6.5 times forward earnings, while a series of plant openings and mine expansions means the North Carolina-based miner will likely triple its lithium hydroxide production by 2027. It has one of the most visible growth trajectories in its industry.
Prices of lithium will also probably increase as Chinese companies work through their stockpiles. Analysts at Morningstar believe that lithium index prices will average over $30,000 for the rest of the decade, which gives Albemarle a $300 value – a 100% upside.
Of course, investing in lithium miners involves risk. Energy giant ExxonMobil (NYSE:XOM) plans to enter the industry by 2027. Its enormous cash reserves will allow the oil firm to buy its way into the lithium business. And a sudden economic contraction could sink lithium index prices as low as $15,000 in the short term. A panicked selloff would send shares of Albemarle as low as $100.
Still, Albemarle is riding a secular wave of decarbonization. As world governments look to achieve net-zero emissions, lithium batteries – and their miners – will see a surge in demand that will likely last for decades to come.
2. Lithium Americas (LAC)
Source: Wirestock Creators / Shutterstock.com
Lithium Americas (NYSE:LAC) is a riskier bet on the global lithium markets. The firm is a relative startup – its only mine is still under development. And its eventual production won’t be as low-cost as the brine-based operations in Chile and Argentina, which use cheap, natural evaporation ponds to purify the metal.
But Lithium Americas makes up for these shortcomings with even better growth prospects, going from zero production to as much as 80,000 metric tons of annual capacity. The firm also sells at a significant discount to the value of its Thacker Pass mine in Nevada, the largest-known lithium deposit in the U.S.
Together, that gives Lithium Americas predictable profitability, as Muslim Farooque writes at InvestorPlace.com this week.
“Moreover, analysts are predicting a bright future for LAC, forecasting a swing in profitability within the next 12 months and a potential 110% increase in LAC stock.”
Lithium Americas’ value could be even higher. The federal $7,500 tax credit for new electric vehicles only applies to cars that meet critical mineral and battery component requirements (read: non-Chinese). And some automakers have already shown a willingness to pay a premium for Lithium Americas.
Plus, General Motors (NYSE:GM) plans to acquire a 25% stake in LAC at a $2.6 billion valuation. With Lithium Americas currently trading at under $1 billion, it’s a clear signal that the company’s fundamental value is far beyond what public markets currently think.
3. ChargePoint (CHPT)
Source: Michael Vi / Shutterstock.com
Ian Cooper also identifies ChargePoint Holdings (NYSE:CHPT) this week at InvestorPlace.com as a company with incredible upside. He believes that $5,000 invested into this stock could eventually become worth $1 million:
While ChargePoint’s chart has been a disaster, don’t write it off. If the U.S. is serious about EV sales, it must build out a massive network of charging stations, including CHPT
Essentially, ChargePoint has been hit by incredible bearishness this year. Investors are quickly realizing that the industry is capital intensive, and that the billions invested in these EV charging stocks might never turn into profits.
But ChargePoint remains a fast-growing firm riding strong secular tailwinds. Analysts expect growth to reaccelerate to 15% next year, and for sales to surge another 42% after that. Demand for EV charging will naturally have a “hockey stick” shape since EV adoption has a cumulative effect. (i.e., charging stations must charge every EV produced that year, as well as every EV produced in the years before that).
Declining interest rates also means that much of ChargePoint’s “millionaire-maker” upside could come in 2024. EV charging stations are worth more when interest rates are low (because their future profit streams are “discounted” back at a lower rate), and even the Federal Reserve’s hint on Wednesday that it would cut rates in 2024 was enough to send CHPT’s stock up 20%.
We believe more could be in store. And though ChargePoint remains a risky stock that’s not for everyone, it still has the qualities that 100%-upside stocks generally share.
4. SoFi Technologies (SOFI)
Source: rafapress / Shutterstock.com
“Are you ready for a Santa Claus rally,” Louis Navellier and the InvestorPlace.com staff ask in this week’s Market360 update. “Now that the federal government’s moratorium on student loan payments expired, SoFi is in a better place.”
Investors in SoFi Technologies (NASDAQ:SOFI), an online banking firm, have plenty of reasons to celebrate this holiday season. A federal moratorium on student loans expired in September this year, which reopened SoFi’s business of student loan refinancing. (The firm is a major player in helping borrowers consolidate loans at cheaper rates.)
Greater-than-zero interest rates mean the online bank is finally earning significant net interest income from customer deposits. And the 2022 selloff means that SoFi trades at less than half of its SPAC debut price. Together, this puts SoFi at that ideal crossroads of having 1) decent growth prospects and 2) a stunningly cheap valuation. And that’s enough to land the stock on Louis’ 7 top-rated stocks for your December buy list.
Consider the first point. As Louis notes, SoFi’s revenues and adjusted profits are on the rise. Sales jumped 27% from a year ago, and analysts believe this trend will continue into fiscal 2024. Earnings are expected to grow even faster.
Then there’s valuation. Today, the online banking firm trades for just 0.78 times book value – a multiple more associated with a no-growth bank than a growing fintech. SoFi also has a solid 14.3% Tier 1 capital ratio and a good history of keeping loan losses low.
Together, that suggests SoFi’s shares could double in the coming year as prices catch back up with the company’s earning power.
5. Luminar Technologies (LAZR)
Source: JHVEPhoto/shutterstock.com
Finally, Muslim Farooque picks out lidar maker Luminar Technologies (NASDAQ:LAZR) this week at InvestorPlace.com for being at the forefront of the autonomous vehicle industry. If AI chips are the “brains” of a self-driving car, the light-based radar technology (lidar) that Luminar creates is its “eyes.” And business is booming.
Farooque writes:
The vehicle autonomy and safety market is on a swift upward trajectory. With forecasts suggesting an impressive surge to a $150 billion valuation by 2030, LAZR’s impactful contributions are becoming increasingly essential.
Luminar is the industry’s top lidar maker by market capitalization. The firm has inked deals with Tier 1 self-driving car suppliers like Mobileye Global (NASDAQ:MBLY) and will soon be found in over 20 upcoming new vehicle models.
The company’s first-mover advantage is a significant asset. Self-driving cars come with enormous reputational risks, and so automakers have every incentive to pick the providers that everyone else is using, even if they cost a little more.
Farooque also notes that Luminar is on a strong financial trajectory: The company reported a robust 33% YOY revenue increase, reaching $17 million. More striking is its forward revenue growth estimate of 80.27%, dramatically surpassing the sector median of 5.53% by over 1,300%.
That suggests that Luminar’s $3 stock price is far too low for its potential. The company’s order book alone is set to grow $1 billion this year. And though Luminar won’t earn profits for several more years, its leading position in the industry means shares could be worth as much as $6.
A Simple Approach With Limited Risk
In 2022, InvestorPlace analyst Luke Lango began recommending shares of Facebook parent Meta Platforms (NASDAQ:META). The firm’s failed “metaverse” experiment and a pullback in digital ad spending meant that Meta’s stock had lost two-thirds of its value. Luke saw an opportunity to buy.
The bet paid off. Since then, Meta’s stock has come roaring back. An investor who bought in November 2022 would be sitting on 270% returns. It was the classic case of finding a moderately fast-growing company selling at dirt-cheap prices. You don’t need risky “hypergrowth” stocks to score hypergrowth returns.
Today, Luke is back with his fellow chief investment analysts – Eric Fry and Louis Navellier – to recommend an even larger set of these potential winners. These are firms they believe will perform much like Facebook – supply reasonable growth and provide stunning investment returns.
And now you can see this for yourself. Eric, Luke, and Louis have developed their own simple strategy that could beat the markets by at least 9X or more next year. It’s an approach, they say, that could show you 2024’s best-performing and most resilient stocks before the New Year arrives. Get the details here.
On the date of publication, Thomas Yeung did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Tom Yeung is a market analyst and portfolio manager of the Omnia Portfolio, the highest-tier subscription at InvestorPlace. He is the former editor of Tom Yeung’s Profit & Protection, a free e-letter about investing to profit in good times and protecting gains during the bad.
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