ACHR - Multibagger Mayhem: 3 Stocks Set to Shatter Expectations

2024-03-15 06:35:00 ET

InvestorPlace - Stock Market News, Stock Advice & Trading Tips

One can say that all investors are hunting for multibagger stocks, or stocks returning many times your original investment. However, for those pursuing a conservative investing approach, the only real challenge is time.

That is, you can buy low-risk stocks like blue-chips, and through the power of compounding, generate multi bagger gains over decades.

However, for those with shorter time horizons, identifying stocks that will generate multibagger-sized gains can be challenging. Mostly, because the types of stocks that will generate such returns in such a short time-frame (speculative growth stocks ) come with a high level of risk and uncertainty.

Yet while there are no guarantees in investing, there are a few growth stocks that stand out as names that could potentially knock it out of the park in the years ahead. That’s the story here, with these three multibagger stocks.

Archer Aviation (ACHR)

Archer Aviation (NYSE: ACHR ) is one of the companies on the forefront of an entirely new industry: electric vertical takeoff and landing (or eVTOL) aircraft, aka “flying cars.”

ACHR stock is valued almost entirely on its future potential (as a provider of these aircraft for use as air taxis in urban areas).

The eVTOL industry is years, if not at least a decade, away from its big “liftoff moment.” Still, it may take just a few years for Archer Aviation to produce multibagger returns for your portfolio.

As argued previously, all it may take to send ACHR to the stratosphere is for the company to get the regulatory green light for its flagship Midnight eVTOL.

From there, progress with selling its aircraft to customers like airlines and the U.S. military could lift this stock (barely out of ‘penny stock territory’ at $5 per share) to substantially higher price levels.

Pagaya Technologies (PGY)

Pagaya Technologies (NASDAQ: PGY ) is a name I’ve included in past coverage of fintech stocks . The company specializes in using proprietary AI-powered software to assess credit risk for loan underwriting,

Turning this technology into a profitable business has been a work-in-progress, but Pagaya has made substantial progress building out and monetizing its platform.

This has resulted in improved fiscal results. Last quarter, revenues were up 13% year-over-year. Adjusted EBITDA came in at $34 million, which represented a big swing from the negative adjusted EBITDA reported in the prior year’s quarter.

This year, per sell-side forecasts, PGY may hit a major milestone: its first full year of generally accepted accounting practices profitability .

PGY stock sells for only 9 times these forecasts, and only 5.8 times earnings forecasts for 2025. If Pagaya meets/beats these expectations, the market could give shares a substantial re-rating, resulting in a multibagger move.

SoFi Technologies (SOFI)

Like Pagaya, SoFi Technologies (NASDAQ: SOFI ) is another fintech with massive upside potential. The digital-first financial services firm has already reached GAAP profitability, but it’s the prospect of exponential earnings growth that makes it one of the potential multibagger stocks.

SoFi has, and continues to, gain new customers for its banking, loan, and other financial services offerings.

Last year, the neobank’s customer base grew by 44.4% , from around 5.2 million to around 7.5 million. With its operating costs largely fixed, this increased member base is poised to translate into outsized improvements in profitability as revenues rise.

Sell-side forecasts call for earnings to rise from 7 cents to 25 cents per share next year. As InvestorPlace’s Dana Blankenhorn pointed out last month, earnings could hit 80 cents per share by 2026 . That could move the needle, as SOFI stock trades for only $7.40 per share .

On the date of publication, Thomas Niel did not hold (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 .

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