Last year was terrible for growth stocks with tightening of monetary policies and growth readjustments in a post-pandemic world. The current year has been better and I would classify the year as a period of consolidation for most growth stocks. Of course, macroeconomic challenges sustain, but I believe that selected growth stocks are likely to skyrocket in 2024.
This column discusses three growth stocks to buy that can potentially double next year. This is a conservative estimate and returns can be higher. Two stocks discussed have growth stories that are backed by positive tailwinds for gold and Bitcoin (BTC-USD). The third stock represents a company that’s in an early-stage of growth in a business with high potential for the coming decades.
Based on annual business developments, I believe that these growth stocks are worth holding even for the next few years. Let’s discuss the reasons to be bullish.
Kinross Gold (KGC)
Kinross Gold (NYSE:KGC) has trended higher by 28% year-to-date (YTD). I, however, believe that the stock remains attractively valued at a forward price-earnings ratio of 14.2. Further, the stock offers a dividend yield of 2.16%. I would not be surprised if KGC stock doubles next year if gold trends higher.
Coming to the outlook for gold, I am positive with geopolitical tensions supporting the precious metal near $2,000 an ounce. Additionally, there is a strong case for rate cuts in 2024 and it’s likely to trigger a rally for gold after an extended period of consolidation.
It’s worth noting that Kinross has guided for stable gold production through 2025. However, I am bullish because of two factors. First, if gold trends higher, revenue growth will be robust and cash flows will swell. For Q2 2023, Kinross had reported operating cash flow (OCF) of $459 million. OCF is likely to be more than $2 billion in 2024 if gold is above $2,000 an ounce.
Further, Kinross has high financial flexibility. As of Q2 2023, the company reported a liquidity buffer of $1.9 billion. There is a strong case for acquisition driven production growth in 2024 or beyond.
Riot Platforms (RIOT)
Riot Platforms (NASDAQ:RIOT) stock skyrocketed from $3.4 at the beginning of the year to $20.7 in July. Of course, the stock has corrected to $11 after this scintillating rally. It’s a good time to accumulate RIOT stock with the outlook looking bullish for Bitcoin.
Specific factors that are likely to support upside in Bitcoin include potential rate cuts, halving due next year, and a possible Bitcoin spot ETF. Standard Chartered believes that Bitcoin can touch $120,000 by the end of 2024. However, even if the digital asset trades near all-time highs, RIOT stock can deliver multibagger returns.
Riot is my favourite pick among Bitcoin miners considering the balance sheet. As of Q2 2023, the company reported cash and digital assets of $510 million. With a zero-debt balance sheet, the company has robust financial flexibility to pursue aggressive growth.
Riot already has ambitious plans to more than triple hash rate capacity by 2025. This will translate into strong revenue and cash flow growth. RIOT stock is therefore positioned to surprise investors in the coming quarters.
Archer Aviation (ACHR)
Archer Aviation (NYSE:ACHR) stock has surged by 177% YTD. ACHR stock has since, however, taken a breather and I believe that another big rally is impending after some consolidation.
A big reason to be bullish on Archer is the fact that the company is close to commercialization of flying cars. It plans to commence electric vertical take-off and landing aircraft operations in 2025 with scaling-up by 2028.
It’s also worth noting that Abu Dhabi Investment Office and Archer have planned to launch all-electric air taxi service across UAE in 2026. The next 24 to 36 months are therefore likely to be exciting for the Archer in terms of growth acceleration.
I must add here that Archer already has a contract worth $142 million from the U.S. Air Force. This is possibly the beginning of order intake from the defense sector. With these positives and the backing of big investors, ACHR stock seems poised for a breakout rally.
On the date of publication, Faisal Humayun did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
