Committing an Investment of $11,000 in Each of These 3 Growth Stocks in 2023 Yields over $1 Million in Profits Currently
Unexpected market gains can bring big rewards, and investing in growth stocks with potential has led to life-changing returns for some, even in just a couple of years. The S&P 500's hot streak has made such success stories less surprising, with three notable examples being AppLovin, MicroStrategy, and Carvana.
AppLovin
AppLovin, a tech company that helps businesses monetize mobile games, has been an impressive growth stock. With sales climbing to $3.3 billion through the first nine months of 2024, representing a 43% increase year over year, and a gigantic leap in net income, it's easy to see why investors have been attracted to this stock.
However, AppLovin's incredible growth may have already been factored into its high valuation, with the stock trading at 100 times trailing earnings and nearly 28 times revenue. Given this, it might be wise for potential investors to consider waiting for a better entry point.
MicroStrategy
Another stock that's been a favorite for investors over the past couple of years is MicroStrategy. The company's bullish Bitcoin strategy has significantly boosted its valuation. With MicroStrategy holding 450,000 Bitcoin as of Jan. 20 and plans to buy more, its share price is likely to follow Bitcoin's direction.
MicroStrategy has also recently been added to the Nasdaq-100, attracting more investors. However, the high risk associated with cryptocurrencies and MicroStrategy's incurred losses in three straight quarters make this stock less suitable for most investors.
Carvana
The biggest gains on this list can be attributed to those who invested in Carvana, a used-car retailer, in 2023, despite facing the threat of bankruptcy. An $11,000 investment would have grown to a massive $472,000 as of 2024. Carvana's profit margins are tight, but an improving economy and a record-breaking adjusted EBITDA have made this stock an interesting long-term opportunity for some.
In conclusion, while these stocks have delivered significant returns, they also carry high risks. Investors should carefully consider their own risk tolerance before jumping into any of these stocks.
Investing in stocks like AppLovin requires careful consideration, as the high valuation might necessitate waiting for a better entry point, despite its impressive growth. Managing finances wisely is crucial when investing, as significant rewards can be reaped from strategic investments in growth stocks, such as MicroStrategy, which has seen a boost in valuation due to its Bitcoin strategy.