The Most Overlooked Stocks with High Growth Potential
Investing in the stock market is always about finding the right opportunities. While many investors flock to big names like Apple or Tesla, several lesser-known stocks often get overlooked but have high growth potential. Let's dive into some of these hidden gems in 2024.
1. Upstart Holdings Inc. (UPST)
Overview: Upstart Holdings, an AI-driven lending platform, is making waves in the fintech industry. Unlike traditional lenders, Upstart uses machine learning to assess creditworthiness, which allows it to offer loans to a broader audience.
Why It’s Overlooked: Despite its innovative approach, Upstart remains under the radar for many investors. Its market cap is significantly lower than traditional banks, making it less visible in the crowded fintech space.
Growth Potential: With more consumers and businesses seeking alternative lending options, Upstart is well-positioned to capture a significant market share. As AI technology advances, its lending algorithms will likely become even more accurate, reducing default rates and increasing profitability.
2. Pinterest Inc. (PINS)
Overview: Pinterest is a social media platform focusing on image sharing and discovery. Users create and share "pins" on various topics, making it a go-to resource for ideas and inspiration.
Why It’s Overlooked: Pinterest often gets overshadowed by social media giants like Facebook and Instagram. Investors tend to focus on platforms with larger user bases, overlooking Pinterest’s niche appeal.
Growth Potential: Pinterest's unique value proposition attracts a highly engaged user base. Its advertising model integrates seamlessly with user interests and offers significant revenue potential. Additionally, its expansion into e-commerce partnerships enhances its growth outlook.
3. Axon Enterprise Inc. (AXON)
Overview: Axon Enterprise is known for developing non-lethal law enforcement tools, such as Taser stun guns and body cameras. The company also offers cloud-based software solutions for evidence management.
Why It’s Overlooked: Axon often flies under the radar because it operates in a niche market. Many investors overlook its innovative products and services' long-term potential in law enforcement and public safety sectors.
Growth Potential: With increasing demand for police transparency and accountability, Axon’s body cameras and digital evidence solutions are seeing widespread adoption. The company’s software-as-a-service (SaaS) model also provides a steady revenue stream, supporting sustained growth.
4. Inari Medical Inc. (NARI)
Overview: Inari Medical specializes in developing innovative medical devices for treating venous diseases. Their minimally invasive products address deep vein thrombosis (DVT) and pulmonary embolism (PE).
Why It’s Overlooked: The medical device industry is vast, and Inari Medical is a relatively new player. Investors who prefer more established companies often need to notice its niche focus on venous diseases.
Growth Potential: Inari's products fill a critical gap in treating venous diseases, offering less invasive alternatives to traditional surgery. With an ageing population and rising incidence of venous disorders, the demand for Inari's solutions is set to grow.
5. Revolve Group Inc. (RVLV)
Overview: Revolve Group is an online fashion retailer that targets millennials and Gen Z. It markets its trendy apparel and accessories through social media influencers.
Why It’s Overlooked: While online retail is booming, Revolve often gets overshadowed by larger e-commerce giants like Amazon and Alibaba. Its reliance on influencer marketing also makes it less appealing to traditional investors.
Growth Potential: Revolve’s innovative marketing strategy and strong brand appeal among young consumers position it for significant growth. As online shopping continues to rise, Revolve’s ability to adapt to fashion trends quickly gives it a competitive edge.
6. Alteryx Inc. (AYX)
Overview: Alteryx offers data analytics and automation software, enabling businesses to convert data into practical insights. Their platform is utilized in multiple sectors, including finance and healthcare.
Why It’s Overlooked: Alteryx competes in a crowded market with well-known giants like Microsoft and IBM. Its smaller size and specialized focus make it less visible to the average investor.
Growth Potential: The demand for data analytics is surging as companies increasingly rely on data-driven decision-making. Alteryx’s user-friendly platform and robust capabilities make it a go-to solution for many organizations, driving its growth.
7. XPEL Inc. (XPEL)
Overview: XPEL develops and sells protective films and coatings for automotive, residential, and commercial use. Their products protect surfaces from damage and enhance durability and appearance.
Why It’s Overlooked: XPEL operates in a niche market, and its products are less widely recognized than those of larger automotive companies. This limited visibility leads to its being overlooked by many investors.
Growth Potential: As consumers and businesses seek to protect their investments, the demand for XPEL’s high-quality protective films is growing. The company’s expansion into new markets and continued innovation in product development support its long-term growth.
8. Brookfield Renewable Partners (BEP)
Overview: Brookfield Renewable Partners focuses on renewable energy and owning and operating hydroelectric, wind, and solar power facilities. It is one of the largest pure-play renewable energy companies in the world.
Why It’s Overlooked: Brookfield Renewable Partners is often overshadowed by more diversified energy companies despite its size and success. While its focus on renewables is increasingly essential, it still garners less attention than traditional energy giants.
Growth Potential: With the global push towards clean energy, Brookfield Renewable Partners is ideally positioned to benefit. Governments and corporations are investing heavily in renewable energy projects, providing a solid growth runway for the company.
9. Fiverr International Ltd. (FVRR)
Overview: Fiverr is an online marketplace that connects freelancers with businesses needing various services, from graphic design to digital marketing. The platform offers a wide range of gig-based services.
Why It’s Overlooked: Fiverr is often overshadowed by larger freelance platforms like Upwork. Its unique gig-based model and smaller market cap make it less prominent in the eyes of many investors.
Growth Potential: The gig economy is booming, and Fiverr's user-friendly platform attracts many freelancers and businesses. As remote work becomes more common, Fiverr has significant potential to grow and gain a larger market share.
10. Planet Labs PBC (PL)
Overview: Planet Labs is a satellite imaging company that provides high-resolution images of the Earth. Its data is used across various sectors, including agriculture, forestry, and urban planning.
Why It’s Overlooked: The satellite imaging market is niche, and Planet Labs is a relatively new entrant. Its specialized services mean it often needs to be noticed by investors focusing on more traditional tech stocks.
Growth Potential: As the need for real-time data and environmental monitoring grows, Planet Labs’ high-resolution images and analytics are becoming increasingly valuable. The company’s ability to provide critical insights across multiple industries supports its growth trajectory.
Conclusion
Investing in overlooked stocks can be a strategic way to achieve high returns. Companies like Upstart Holdings, Pinterest, Axon Enterprise, Inari Medical, Revolve Group, Alteryx, XPEL, Brookfield Renewable Partners, Fiverr, and Planet Labs all offer significant growth potential despite flying under the radar. By watching these hidden gems, investors can capitalize on emerging trends and market opportunities in 2024.