In this article, we’re going to talk about the 8 unstoppable stocks that could make you richer.
Navigating Volatile Equity Markets
In the current climate of extreme market volatility, finding safe and stable investments is challenging. Valuations seem overstretched following one of the longest bull runs, with major indices reaching record highs. Despite this, the focus should remain on stocks of companies with strong fundamentals and solid long-term prospects.
Similarly, it’s crucial to consider companies that can withstand uncertainties caused by various headwinds, such as rising geopolitical tensions, the US election, and the high interest rate environment. While the recent Federal Reserve rate cut, declining inflation rates, and a prolonged bull market have benefited investors, not all stocks are responding uniformly.
READ ALSO: 8 Worst Performing Tech Stocks in 2024 and 10 Worst Performing Blue Chip Stocks in 2024.
How Are Economic and Geopolitical Factors Influencing Investments?
As the US election approaches, economic issues remain the primary concern for most voters. Despite the equity market’s upward trend, the US economy has experienced several shocks, including slowdowns in the labor and real estate markets. Although inflation has decreased from a high of 9.2% to 2.4%, the Federal Reserve had to cut interest rates by 50 basis points to prevent a recession.
“Even as the data shows inflation has theoretically been slowing down, it has become more important in people’s minds over the course of the last three quarters, not less important,” said Jay Campbell, partner at Hart Research, the Democratic pollster for the survey.
The significant drop in inflation has coincided with higher growth expectations, driving upward momentum in the equity markets. Strong macroeconomic data, such as impressive GDP and retail sales figures, have supported these growth expectations. Amid these expectations, bond yields have increased, indicating that investors are selling safe-haven assets. Economists at Goldman Sachs suggest that the rise in yields is due to promising growth prospects rather than factors like the anticipation of Donald Trump’s potential presidency or concerns about the Fed’s rate cuts causing inflation to spike again.
“Yields have risen significantly over the past several weeks, which we find has owed primarily to continued strong U.S. growth momentum rather than shifts in election odds,” Goldman said in a recent note.
Conversely, escalating trade and tariff tensions between the US and China pose a threat to market sentiment. The International Monetary Fund has warned that these tensions could have costly economic consequences globally.
“We are seeing geopolitically driven trade around the world, which is why when you look at overall trade to GDP that’s holding up fine, but who’s trading with whom is certainly changing,” said Gita Gopinath, deputy managing director of the International Monetary Fund, to CNBC on October 23, 2024.
In response to perceived unfair trade practices by Beijing, the US and EU have increased tariffs on certain Chinese goods, further escalating trade tensions this year.
Despite rising geopolitical tensions, long-term investing remains the best strategy for building a profitable portfolio and sustaining growth over time. Key factors to consider include investing in businesses rather than just share prices, understanding the underlying business, and consistently investing during both market highs and lows.
With that, we’re here with a list of the 8 unstoppable stocks that could make you richer.
Source: Pexels
Our Methodology
For this article, we identified approximately 20 stocks with a year-to-date share price gain of over 30% as of October 25 and an average analyst price target upside of at least 30%. We then narrowed the list to the 8 stocks with the highest average analyst price target upsides, ranking them primarily by upside potential and secondarily by year-to-date gains.
At Insider Monkey, we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Unstoppable Stocks That Could Make You Richer
8. Super Micro Computer, Inc. (NASDAQ:SMCI)
Average Analysts Upside Potential as of October 25: 33.40%
Year-to-date gains: 66.89%
Number of Hedge Fund Holders: 47
Super Micro Computer, Inc. (NASDAQ:SMCI) is an unstoppable stock that could make you richer as it is developing high-performance server and storage solutions that are in high demand amid the artificial intelligence race and digital revolution. It is turning out to be one of the biggest beneficiaries of the AI boom as it makes computers that companies use as servers for data storage.
At the start of 2024, Super Micro Computer, Inc. (NASDAQ:SMCI) held just 6% of the worldwide server market. Selling liquid-cooled, high-performance servers for demanding computing tasks has allowed it to carve out a niche for itself. Because of this, Nvidia found Supermicro to be a perfect partner and provided it with top-tier data center GPUs to aid in producing dedicated AI servers.
Though not exclusive, its strategic partnership with Nvidia has strengthened its competitive edge in the server market. Super Micro’s revenue more than quadrupled from $3.6 billion in fiscal 2021 to $14.9 billion in fiscal 2024, coinciding with the generative AI market’s explosive growth. Additionally, its earnings per share (EPS) increased by almost ten times. More than half of its revenue now comes from AI servers.
The confirmation that Super Micro Computer, Inc. (NASDAQ:SMCI) is shipping more than 100,000 graphics processing units used for artificial intelligence underlines the strong demand that could translate into billions of dollars in revenues. Like other cloud service providers, Super Micro claimed to have recently installed over 100,000 GPUs with liquid cooling for some of the largest AI factories ever built.
The soaring GPU orders are one of the reasons analysts remain bullish about Super Micro Computer, Inc. (NASDAQ:SMCI), with an average price target of $64.22, implying a 33.40% upside potential as of October 25, 2024. As per Insider Monkey’s Q2 2024 database, the company was in the portfolios of 47 hedge funds.
Scout Investments, Inc, an affiliate of Carillon Tower Advisers, released a second-quarter 2024 investor letter. Here is what the fund said:
“Super Micro Computer, Inc. (NASDAQ:SMCI) was the top detractor to returns in the second quarter. Super Micro designs and manufactures server solutions based on modular and open-standard architecture. This modular approach combined with a strong engineering culture helps the company to supply the market with advanced servers and rack-scale compute solutions quickly. After an impressive return in the first quarter, the company offered disappointing near-term earnings guidance, though we do not believe its long-term opportunity has diminished. We expect continued strong growth for several years, although the range of outcomes is quite wide; it is difficult to forecast AI server market growth with precision.”
7. Telephone & Data Systems, Inc. (NYSE:TDS)
Average Analysts Upside Potential as of October 25: 37.13%
Year-to-date gains: 56.99%
Number of Hedge Fund Holders: 32
Telephone & Data Systems, Inc. (NYSE:TDS) is an unstoppable stock that could make you richer as it navigates the competitive telecommunication sector with significant success. While the stock is already up by more than 50% for the year, analysts believe it boasts a 37.13% upside potential owing to its strong operational execution and its ability to adapt to dynamic market demands.
Telephone & Data Systems, Inc. (NYSE:TDS) has inked a deal to sell its cable operations in Texas to Poka Lambro Telecommunications, Ltd. and Nevill Holdings, Inc. As TDS concentrates on its core markets and seeks to increase profitability, the deal, which is anticipated to close in the fourth quarter of 2024, represents a strategic change for the company.
The deal is anticipated to improve TDS’s core-focused service offerings and give clients access to more advanced technical capabilities. This will probably boost TDS’s earnings in the following quarters and solidify its standing as a telecom industry leader.
The increased focus on the core business catalyzed the company’s solid second-quarter results. Revenues in the quarter totalled $1.24 billion, beating consensus estimates by 0.02%. Likewise, the company’s net loss shrunk to $0.13 a share compared to a loss of $0.17 a share last year.
Telephone & Data Systems, Inc. (NYSE:TDS) is an unstoppable stock that could make you richer, given that it has maintained its dividend payments for 51 consecutive years and raised its dividend for 31 straight years. The stock yields 0.58%.
Insider Monkey’s Q2 2024 survey of 912 hedge funds revealed that 32 were the firm’s shareholders. Telephone and Data Systems, Inc. (NYSE:TDS)’s largest stakeholder in our database is Dan Loeb’s Third Point due to its $46.97 million stake.
6. Sarepta Therapeutics, Inc. (NASDAQ:SRPT)
Average Analysts Upside Potential as of October 25: 46.78%
Year-to-date gains: 38.10%
Number of Hedge Fund Holders: 55
Sarepta Therapeutics, Inc. (NASDAQ:SRPT) is a biotechnology company that discovers and develops RNA-targeted therapeutics and gene therapies for treating rare diseases. It is one of the unstoppable stocks that could make you richer as it achieves significant milestones in the gene therapy space. The U.S. Food and Drug Administration (FDA) recently expanded the approval of Elevidys, the company’s flagship product, making Sarepta a significant player in the Duchenne muscular dystrophy DMD treatment market.
Elevidys has shown statistically significant effects on secondary endpoints that reflect muscle function in clinical trials, filling a crucial gap in treating DMD. Amid the approval and strong demand, Elevidys’ peak sales in the U.S. market alone are expected to range from $2.7 billion to over $5 billion per year.
Since its approval in June 2023, the therapy has generated $334 million in revenue, with sales of $134 million in the first quarter of 2024. There is now a straightforward way for those sales to keep increasing for even longer. In the upcoming years, it is anticipated that the treatment’s effectiveness and Sarepta’s experience with commercialization will spur quick adoption and revenue growth.
Elevidys’s broader approval has greatly improved Sarepta Therapeutics, Inc. (NASDAQ:SRPT)’s financial prospects. Revenue totalled $1.2 billion last year, but the company lost $536 million on that. Elevidys’ revenue contribution was $200 million. Thanks to the label expansion, Sarepta will have a far better chance of making money in the future.
While Sarepta Therapeutics, Inc. (NASDAQ:SRPT) is already up by more than 30% for the year, analysts on Wall Street remain optimistic about its long-term prospects, with an average price target of $195.20, implying 46.78% upside potential as of October 25 2024.
As of Q2 2024, 55 hedge funds tracked by Insider Monkey held positions in Sarepta Therapeutics, Inc. (NASDAQ:SRPT), with stakes totaling $2.90 billion. VenBio Select Advisor holds the largest stake, valued at $474 million.
5. Net Lease Office Properties (NYSE:NLOP)
Average Analysts Upside Potential as of October 25: 52.72%
Year-to-date gains: 66.13%
Number of Hedge Fund Holders: 15
Net Lease Office Properties (NYSE:NLOP) is an unstoppable stock that could make you richer while investing in the real estate sector. It operates as a real estate investment trust (REIT) with a portfolio of quality office properties. After being split off from a larger REIT, the company wants to sell its properties to pay off high-interest debt and eventually give shareholders their money back.
Even as Net Lease Office Properties (NYSE:NLOP) continues to divest some of its assets, it generates significant amounts of adjusted funds from operations from existing leases. As of the end of the second quarter, it owned 47 office properties that generated $102.5 million in annualized base rent with an occupancy rate of 82.7%. The fact that some of the top tenants include JPMorgan, CVS Health and KBR underlines a stable revenue base that allows it to support its dividend yield of 4.48%.
While the Net Lease Office Properties (NYSE:NLOP) sold six office assets in the quarter for $192.2 million, most funds were used to refinance debt as the company sought to strengthen its financial position. Given that the company’s combined assets are worth more than its financial obligations, it remains an attractive investment for investment in the US office sector.
Likewise, analysts on Wall Street maintain a buy rating on Net Lease Office Properties (NYSE:NLOP) with an average price target of $46, implying a 52.72% upside potential as of October 25 2024.
According to Insider Monkey’s database, 15 hedge fund portfolios held Net Lease Office Properties at the end of the second quarter, down from 19 in the previous quarter.
Alluvial Capital Management stated the following regarding Net Lease Office Properties (NYSE:NLOP) in its Q2 2024 investor letter:
“Our portfolio is largely unchanged from last quarter, with Net Lease Office Properties (NYSE:NLOP) still at the top. “NLOP” has been very active, selling five properties and surrendering two more to lenders in May and June. NLOP used its sales proceeds to reduce its term loan by $138 million and its mezzanine debt by $22 million. Since going public by spin-off last November, Net Lease Office Properties has reduced its term loan and mezzanine debt by 47% to $243 million, leaving it modestly levered and highly cash-generating as it continues to wind down
Excluding a few properties likely to be surrendered to lenders, Net Lease Office Properties now produces annualized base rents of $105 million. The market is valuing NLOP at $587 million for a cap rate (net property operating income/enterprise value) of 17.9% and $90 per square foot. It’s just plain dirt cheap, and the continuing liquidation of the Net Lease Office Properties portfolio will cause this discount to close sooner rather than later. At a still conservative 12% cap rate or $135 per square foot, NLOP would be worth $46 per share.”
4. AST SpaceMobile Inc. (NASDAQ:ASTS)
Average Analysts Upside Potential as of October 25: 70.95%
Year-to-date gains: 423.16%
Number of Hedge Fund Holders: 15
AST SpaceMobile (NASDAQ:ASTS) is a technology company that, together with its subsidiaries, provides a space-based cellular broadband network. The company operates five satellites in orbit that offer a cellular broadband network and plans to manage up to 95 satellites.
Its edge as an unstoppable stock that could make you richer stems from the fact that it is developing a service that can be offered for sale to several telecom companies. Partnering with telecommunication heavyweights Verizon and AT&T should allow the company to access an existing pool of cell customers. Consequently, it will not have to develop its own clientele, unlike rival Starlink, which is essentially attempting to go it alone.
Secondly, AST SpaceMobile (NASDAQ:ASTS) can raise money from its partners to cover the enormous expenses of establishing a global satellite network. It will probably still need to raise more funds from investors, which could dilute current shareholders, but having deep-pocketed partners is a clear benefit to the long-term success of the company.
AST SpaceMobile has contracts with numerous other businesses worldwide, giving it access to over 2.8 billion potential customers in the long run. There appears to be a lot of potential for the company as it grows over time, assuming it continues operating effectively.
The support that AST SpaceMobile (NASDAQ:ASTS) enjoys from AT&T and Verizon affirms its long-term prospects as a potential challenger of Starlink. This might explain why the stock is already up by more than 400% and rated as a by with an average price target of $43.73, implying a 70.95% upside potential as of October 25, 2024.
At the end of the second quarter of 2024, 15 hedge funds in the database of Insider Monkey held stakes worth $67.38 million in AST SpaceMobile, Inc. (NASDAQ:ASTS), compared to 13 in the preceding quarter worth $19.49 million.
3. Summit Therapeutics Inc. (NASDAQ:SMMT)
Average Analysts Upside Potential as of October 25: 67.81%
Year-to-date gains: 685.23%
Number of Hedge Fund Holders: 17
Summit Therapeutics Inc. (NASDAQ:SMMT) is a biopharmaceutical company that discovers, develops, and commercializes societal-friendly medicinal therapies. The company’s lead development candidate is Ivonescimab, a bispecific antibody for cancer treatment. It is touted as an unstoppable stock that could make you richer on the prospect of Ivonescimab becoming the world’s top-selling cancer treatment.
Ivonescimab is an intriguing new double-sided protein that prevents vascular endothelial growth factor (VEGF) from expanding a tumour’s blood supply while also inhibiting the PD-1 checkpoint. Because investors believe it has the potential to become the new standard of care for patients with first-line lung cancer, the company’s stock price has skyrocketed. Merck’s cancer treatment Keytruda generated $25 billion in sales last year, underscoring the tremendous opportunity for Summit Therapeutics with Ivonescimab.
Summit Therapeutics Inc. (NASDAQ:SMMT) is in a tight alliance with Akeso, a biotechnology company in China that conducted the initial clinical trials for Ivonescimab and is responsible for its research and development (R&D) efforts in its creation. Furthermore, it is conducting numerous clinical trials at every phase, evaluating Ivonescimab for various subtypes of non-small cell lung cancer (NSCLC) and other uses such as metastatic colorectal cancer and recurrent ovarian cancer.
Summit Therapeutics Inc. (NASDAQ:SMMT) is full of opportunities as Ivonescimab is a promising medication on which it can expand. One exceptionally successful medication can sometimes be all that is needed to finance a company’s long-term expansion and open the door to a future valuation of enormous proportions.
While Summit Therapeutics Inc. (NASDAQ:SMMT) is already up by over 600% for the year, analysts insist it is a strong buy with an average price target of $34.67, implying 67.81% upside potential as of October 25, 2024.
Insider Monkey dug through 912 hedge fund holdings for the second quarter of 2024 and discovered that 17 had held a stake in Summit Therapeutics Inc. (NASDAQ:SMMT).
2. Root, Inc. (NASDAQ:ROOT)
Average Analysts Upside Potential as of October 25: 93.15%
Year-to-date gains as of October 25: 275.21%
Number of Hedge Fund Holders: 11
Root, Inc. (NASDAQ:ROOT) is a financial services company that provides insurance products and services to homeowners and renters. While trading at a discount with a price-to-earnings multiple of 1.90, it is one of the unstoppable stocks that could make you richer as it continues to disrupt the car insurance industry.
Root, Inc. (NASDAQ:ROOT) optimizes pricing and improves customer satisfaction using its in-house technology and machine learning models. Thanks to this strategy, it’s been able to focus on profitability while achieving some of the best loss ratios in the industry. Additionally, it has increased new writings by 120% annually, demonstrating significant progress in its partnership channel. The business is well-positioned to spur further growth with over a dozen partners and a strong pipeline of new opportunities.
Root, Inc. (NASDAQ:ROOT)’s competitive edge in the insurance sector stems from using driving behaviour rather than demographics to base insurance rates. Therefore, it utilizes over 20 billion miles of mobile telematics data to offer personalized insurance coverage. It also stands out due to its strong financial results that underline solid fundamentals and growth metrics backed by proprietary data, allowing it to streamline operations and enhance customer service.
While Root, Inc. (NASDAQ:ROOT) did deliver a net loss of $0.52 a share in the second quarter, it was better than the $1.74 a share expected and the $2.55 a share loss delivered last year in the same quarter. Disciplined underwriting and a focus on cost reduction have helped Root, Inc. (NASDAQ: ROOT) achieved a gross loss ratio of 61.6%, indicating its operational effectiveness and potent risk management skills.
Consequently, analysts on Wall Street believe the stock is a buy, going by the average price target of $75.60, which implies a 93.15% upside potential as of October 25, 2024.
1. Babcock & Wilcox Enterprises, Inc. (NYSE:BW)
Average Analysts Upside Potential as of October 25: 236.13%
Year-to-date gains: 61.56%
Number of Hedge Fund Holders as of Q2: 19
Babcock & Wilcox Enterprises, Inc. (NYSE:BW) is a technology provider providing energy and emissions control solutions to industrial electrical utilities and municipalities. It is one of the unstoppable stocks that could make you richer as it has secured a string of substantial contracts that affirm strong demand for its solution. In the UK, it has landed an $8 million contract for a cooling system for a renewable energy facility. It has also inked a $25 million contract for upgrades and maintenance of a thermal plant in The US
Additionally, Babcock & Wilcox Enterprises, Inc. (NYSE:BW) has agreed to sell its Italy and Sweden-based assets for about $40 million. The sale is part of a divestment strategy that Babcock Wilcox Enterprises uses to reduce its long-term debt and improve its balance sheet.
In addition to new technologies like BrightLoopTM and ClimateBrightTM, the company intends to concentrate on its core portfolio of technologies, which includes thermal, renewable, and environmental solutions. In order to satisfy emissions reduction requirements while preserving dependable base load energy generation, Babcock & Wilcox Enterprises, Inc. (NYSE:BW) is also assisting its U.S. clients with coal-to-natural-gas conversions.
The company’s excellent operating performance propelled it into solid second-quarter results whereby revenues totalled $233.6 million, exceeding analyst expectations despite being lower than the previous quarter. Additionally, the operating income of $42.2 million and net income of $25.4 million both surpassed projections. Its year-to-date bookings of $383.1 million and implied bookings of $668.5 million, a 71% increase over the first half of 2023, are what make this cheap penny stock impressive.
While Babcock & Wilcox Enterprises, Inc. (NYSE:BW) is already up by about 62% for the year, analysts remain optimistic about its long-term prospects, with an average price target of $8, implying 236.13% upside potential as of October 25, 2024.
At Q2’s end, a total of 19 of the hedge funds tracked by Insider Monkey were bullish on this stock, up from 14 in the first quarter of 2024. According to Insider Monkey’s hedge fund database, Aaron Weitman’s CastleKnight Management has the number one position in Babcock & Wilcox Enterprises Inc (NYSE:BW), worth close to $6.17 million, accounting for 0.3% of its total 13F portfolio.
While we acknowledge the growth potential of Babcock & Wilcox Enterprises, Inc. (NYSE:BW), our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than BW but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock
Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
