Three Growth Stocks with Higher Potential Than Any Cryptocurrency

Three Growth Stocks with Higher Potential Than Any Cryptocurrency

Many growing investors have turned to the cryptocurrency market this year in hopes of lower interest rates, approvals of the first Bitcoin Spot-priced exchange-traded funds (ETFs) and big institutional buying suggest the “crypto winter” is over. However, it is still difficult to assess the true value of most cryptocurrencies, as their price depends more on supply and demand than the actual underlying activity.

Earlier this month, I suggested investors buy three promising technological stocksNvidia, Super microcomputerAnd ASML — instead of investing heavily in cryptocurrencies. Today, I will add three more speculative games to this list of potential alternatives to cryptocurrencies: Symbolic (NASDAQ:SYM), QuantumScape (NYSE:QS)And IonQ (NYSE:IONQ).

Three Growth Stocks with Higher Potential Than Any Cryptocurrency

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1. Symbolic

Symbotic is a provider of robots and warehouse automation software. It claims that a $50 million investment in just one of its modules (which includes its robots and software) can generate $250 million in savings over 25 years.

Symbotic went public by merging with a special purpose acquisition company (PSPC) in June 2022. Its revenue jumped 136% in fiscal 2022 (which ended in September 2022) and 98% in fiscal 2023. However, the bulk of this growth comes from an agreement with Walmartwhich tapped Symbotic to automate all of its U.S. regional distribution centers through fiscal 2034. Walmart still owns 11% of Symbotic and accounted for 88% of its revenue in fiscal 2023 .

This concentration of customers is worrying, but it allows agreements to be concluded with other large retail customers like Target, Albertson, and C&S Wholesaler. It also launched a new warehouse-as-a-service platform called GreenBox with its other major backer, SoftBankLast July.

Analysts expect Symbotic’s revenue to grow 48% in fiscal 2024 and 42% in fiscal 2025. The company is still bleeding red ink, but it is expected to become profitable under generally accepted accounting principles (GAAP) by fiscal 2025. Its stock isn’t cheap. at 16 times this year’s sales, but it could be a big pure play in the warehouse automation market.

2. QuantumScape

QuantumScape develops solid-state batteries, which are more stable, charge faster and last longer than traditional lithium-ion batteries. These batteries are a great fit for the electric vehicle (EV) market, and the company’s biggest backer is Volkswagen. Like Symbotic, QuantumScape went public by merging with a SPAC in November 2020. But unlike Symbotic, QuantumScape is not yet generating significant revenue.

QuantumScape hasn’t released any of its batteries since its public debut, but its latest batteries could give electric vehicles a range of 400 to 500 miles with a charge time of less than 15 minutes. It is also developing batteries that can last up to 600 miles with a charging time of less than 30 minutes. For reference, most high-end lithium-ion batteries for electric vehicles have a range of around 300 miles and a charge time of 30 minutes. Volkswagen also recently conducted an endurance test that found QuantumScape’s batteries could power an electric vehicle for more than 310,000 miles “without any noticeable loss of range.” Most lithium-ion batteries lose about 10% of their range after the first 200,000 miles.

QuantumScape’s technology appears disruptive, but it’s difficult to value its stock without any revenue. However, if it succeeds in getting its first batteries to market before like-minded competitors, its stock could skyrocket over the next few years.

3. IonQ

Investors looking for another speculative play should take a look at IonQ, a quantum computing company that merged with a SPAC in October 2021. IonQ provides quantum computing power as a cloud-based service and attempts to shrink bit processing unit (QPU) systems. from several feet to a few inches wide thanks to its “trapped ions” technology.

He hopes this miniaturization will make it easier to build large quantum computing systems that simultaneously process binary “bits” of zeros and ones. This big step forward could support the growth of the cloud, machine learning and artificial intelligence (AI) markets.

IonQ measures its quantum computing power in algorithmic qubits (AQ). It reached AQ 29 in 2023, AQ 35 earlier this year, and aims to reach AQ 64 by 2025 with a longer-term goal of 1,024 by 2028. It has only generated $22 million of revenue in 2023, but it continues to generate new revenue. government and commercial customers. Analysts expect its revenue to grow 77% in 2024 and 110% in 2025 – so there could still be plenty of upside potential.

IonQ is not yet profitable and its stock looks expensive, nearly 50 times this year’s sales. But if it can achieve its ambitious miniaturization goals and expand its business, its sales could soar as the nascent quantum computing market grows.

Should you invest $1,000 in Symbotic right now?

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Leo Sun has positions in ASML. The Motley Fool holds positions and recommends ASML, Bitcoin, Nvidia, Target, Volkswagen Ag and Walmart. The Motley Fool has a disclosure policy.

3 Growth Stocks With More Potential Than Any Cryptocurrency was originally published by The Motley Fool

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