Stocks to buy

3 Stocks to Buy for 5-Bagger Returns by 2025

It’s been a year of stocks with high returns quickly. In the first half of the year, Marathon Digital (NASDAQ:MARA) delivered four-bagger returns. There are dozens of stocks that have doubled or tripled. This comes after a deep correction in growth stocks last year.

While some stocks look overvalued, there are others that can be considered for exposure at current levels. The example of MARA stock was to underscore the point that multibagger returns can come in the blink of an eye.

I would, however, keep my estimates conservative. The stocks with high returns potential discussed in the column are likely to deliver 5-bagger returns within a time horizon of 24 to 30 months. It’s important to note that these stocks represent companies that are fundamentally strong. Further, growth is likely to be supported by positive industry tailwinds.

Let’s discuss the reasons to be bullish on these best stocks for 5-bagger returns.

Riot Platforms (RIOT)

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Riot Platforms (NASDAQ:RIOT) stock has skyrocketed in the first half of 2023. The key reason is an upside in Bitcoin (BTC-USD). At the same time, the company has unveiled massive expansion plans. Once these investments are incurred, Riot will be positioned for robust upside in revenue and cash flows.

Of course, the basic assumption is that Bitcoin will remain in an uptrend. This seems likely considering the point that Bitcoin halving is due next year. Further, interest rates have peaked, and the dollar is likely to weaken on a relative basis, which is positive for all risky asset classes.

Regarding the expansion plans, Riot reported a mining capacity of 10.5EH/s as of Q1 2023. In June, the company announced plans to purchase 33,280 miners, boosting mining capacity to 20.1EH/s by 2024.

The company has the option to purchase 66,560 additional miners. If this option is exercised, capacity will increase to 35.4EH/s by December 2024. With the possibility of 3.5x growth in capacity in the next 18 months, RIOT seems positioned for multibagger returns.

Joby Aviation (JOBY)

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Joby Aviation (NYSE:JOBY) stock has surged by 140% year-to-date. This does not come as a surprise as the air mobility company inches closer to commercialization. I expect the rally to sustain the industry at the nascent stage, and the company’s business progress looks promising.

Earlier this month, Joby announced the completion of the submission of stage three plans to the Federal Aviation Administration. As the company moves closer to completion of a third of the five stages required to certify its aircraft for commercial use, the outlook is bullish.

It’s worth noting that Joby already has potential contracts worth $131 million from the U.S. Department of Defense. This underscores the company’s technological credibility. From a financial perspective, Joby ended Q1 2023 with cash and equivalents of $978 million. With an additional infusion of $180 million in May, the company has robust financial flexibility through commercialization.

Curaleaf Holdings (CURLF)

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The major catalyst for multibagger returns in cannabis stocks is Federal-level legalization. However, that’s not the only factor that’s likely to trigger growth for the industry. States have been legalization cannabis, and innovation-driven cannabis companies are likely to be performers. My view is underscored by the fact that the recreational cannabis industry in Arizona recently breached the $100 million monthly mark.

Curaleaf Holdings (OTCMKTS:CURLF) stock seems well-positioned to benefit from sustained growth in the cannabis industry. The company has a presence in 19 states in the U.S., and revenue growth has been healthy. Additionally, the company has established a presence in eight European countries.

For Q1 2023, Curaleaf reported 14% year-on-year revenue growth to $337 million. For the same period, the company reported a healthy adjusted EBITDA margin of 22%.

An important point to note is that the company has a significant focus on research and development. Last year, the company launched 171 products. As the product portfolio widens, the company’s revenue growth is likely to accelerate.

On the date of publication, Faisal Humayun 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 Publishing Guidelines.

Faisal Humayun is a senior research analyst with 12 years of industry experience in the field of credit research, equity research and financial modeling. Faisal has authored over 1,500 stock specific articles with focus on the technology, energy and commodities sector.