With investing, few things are as rewarding as doubling your money. It doesn’t matter how long I’ve been an investor, but when a stock crosses that 100% threshold, I still feel like celebrating. I’m betting I’m not alone and that you’re also excitedly searching for stocks that have the potential to double…
Allow me to help as I believe the five stocks in this article could double over the next five years. So much could be said about each one, but for the sake of brevity, I’ve laid out each company’s moat and what kind of growth can propel market-beating gains in the years to come.
People clearly love the idea of a social media platform like Pinterest (NYSE:PINS), as shown by the company’s quickly growing base of 442 million monthly active users and the lack of viable alternatives. Facebook launched an app called Hobbi to compete, but the social media giant quickly killed the project after it failed to get more than a measly 7,000 downloads, according to mobile-app tracker Sensor Tower. Whether it’s because of its first-mover advantage or something else, people seem to prefer Pinterest over other options, meaning this company is doing a good job defending its niche.
One of the keys to Pinterest’s long-term success is its base of international users. In the third quarter, they accounted for 78% of all users on the platform but only 16% of the revenue. The company is still staffing offices in places like Europe so it can start making advertisers abroad aware of how to use the platform.
And it plans to start monetizing Latin America this year, showing just how early we are in this story. As the monetization of its largest user base picks up speed, it’s not hard to see how Pinterest can grow revenue at an outsized pace — to say nothing about ongoing monetization progress in the U.S.
The stock went up over 250% in 2020, but Pinterest is still a buy in 2021.
Equipment rental company United Rentals (NYSE:URI) isn’t a household name, and that’s a shame. Since the beginning of 2011, the stock has returned over 1,000%, one of the best performers of the last decade. And yet, unlike many other high-fliers, the company is still relatively small with just an $18 billion market cap, and shares are relatively cheap at 20 times trailing earnings.
One reason to love United Rentals is its scale. According to its October investor presentation, the company is the market-share leader for equipment rentals in North America with 1,170 locations in 49 states and all 10 Canadian provinces. This scale is hard to match and gives the company great flexibility. The COVID-19 pandemic impacted regions differently, and United Rentals has been able to take advantage of this dynamic in regions where business remained strong. As a result, it didn’t close a single branch or lay off a single employee because of the coronavirus.
United Rentals is a cash flow machine. It generated…
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