Keith Speights, The Motley Fool
5 min read
Even after its sharp pullback, Space Exploration Technologies’ (NASDAQ: SPCX) market cap still hovers around $2 trillion. That’s an astronomical (no pun intended) valuation for a company that generated revenue of $18.7 billion last year and posted a loss of nearly $5 billion.
Could SpaceX double anytime soon? It’s highly unlikely. Maybe over a long period of time, the company will open up exciting new markets that could lead to its share price gaining 100% or more. However, its premium pricing and the prospects of near-term insider selling after the lockup period expires present significant hurdles to the stock doubling over the next two or three years.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a “Double Down” signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same “Total Conviction” signal is flashing for a company 1/100th the size of Nvidia. Continue »
Investors who want explosive upside don’t need to bet on science fiction valuations. Here are three stocks that have realistic paths to doubling relatively quickly.
1. ADMA Biologics
Unlike SpaceX, ADMA Biologics (NASDAQ: ADMA) is already profitable. And its earnings are growing. The company posted net income of $407 million in the first quarter, up 22% year over year.
ADMA markets three approved products, all plasma-derived immunoglobulin (IG) therapies. Asceniv is its flagship product, generating roughly 86% of total revenue. It was approved by the U.S. Food and Drug Administration (FDA) in 2019 for treating primary humoral immunodeficiency, a group of genetic disorders in which the body’s immune system can’t make enough antibodies, called immunoglobulins, to defend against infections.
The consensus analysts’ 12-month price target for this biotech stock is almost exactly double the current share price. Raymond James (NYSE: RJF) recently initiated coverage of ADMA Biologics with a buy recommendation and a price target that implies potential upside of around 140%.
What’s behind Wall Street’s optimism about ADMA? For one thing, the company has captured only around 4% of its total addressable market so far. That market is expected to grow at a compound annual rate of 10% through 2033. ADMA has also developed technology that delivers IG production yields 20% or more higher with the same quantities of plasma, which should boost both revenue and earnings.
2. EyePoint Pharmaceuticals
EyePoint Pharmaceuticals (NASDAQ: EYPT) and SpaceX share at least two things in common. Both stocks are up around the same percentage year to date. Both companies are losing money. But EyePoint has a better excuse for its lack of profitability: it doesn’t yet have an approved product.
