Investors usually miss undiscovered treasures in the constantly changing stock market landscape. Even though the big dogs usually get all the attention, underdogs occasionally have the best chance of making a huge return. Here are three underrated stocks ready for a comeback that are heavyweights in their fields. These stocks may completely change the nature of the industry by 2024.
To begin with, the first one’s deliberate growth of its direct-to-consumer (D2C) market offers a profitable route to global supremacy as streaming conflicts heat up. In the meantime, the second one’s unwavering rise in the number of digital payments suggests that cash will eventually become obsolete. Finally, the third one is a leader in 5G solutions and cellular technology that may completely change the way we connect.
Read more to learn about these underappreciated titans’ recent performances, calculated moves and unrealized potential that may propel them into the public eye. Explore the leaders in banking, entertainment and telecommunications in search of the newest wave of industry disruptors that may deliver a spectacular return.
Warner Bros Discovery (WBD)
With the launch of new ad-supported products and the expansion of its streaming service, Max, into other territories, Warner Bros Discovery (NASDAQ:WBD) has a massive growth lead in the D2C market. Including 1.3 million members from the BluTV purchase, Warner Bros Discovery had around 98 million D2C customers (Q4 2023). That signifies a sequential rise and the company’s ongoing pace for subscriber growth.
Furthermore, Warner Bros Discovery is attempting to introduce Max in important worldwide markets, including Latin America, Europe, the Middle East and Asia-Pacific. These regional launches may dramatically increase the company’s addressable market and spur subscriber growth.
Additionally, Warner Bros Discovery is concentrating on improving D2C segmentation and monetization by launching new solutions backed by advertising. The introduction of an ad-supported product in the United States, with intentions to take it to more than 40 markets worldwide by the year’s end. There is favorable EBITDA produced in 2023, a $2.2 billion increase.
Overall, that makes the D2C segment’s contribution to the company’s financial success clear. Hence, the aforementioned growth highlights the segment’s capacity to generate profitable top-line growth.
PayPal (PYPL)
The total payment volume (TPV) and number of active accounts on PayPal (NASDAQ:PYPL) are slowly but steadily rising. That means PayPal’s reach only expands with greater transaction volumes. Overall, in the fourth quarter of 2023, TPV improved 15% (YoY) to $409.8 billion.
Additionally, payment transactions jumped by 13% to $6.8 billion during the same period. For 2023, TPV grew 13% to $1.53 trillion, while payment transactions also landed 12% higher at $25 billion. That further manifests as strong development in TPV and the number of payments, reflecting PayPal’s capability for new customer acquisition.
Some key factors driving the development of solid growth elements include the rise in e-commerce, the growing acceptance of digitized payments and an expansion in PayPal’s innovations for better payment solutions.
Moreover, PayPal benefits from a higher TPV and a higher number of payment transactions since it charges a fee for each transaction handled through its platform. Thus, PayPal’s revenue growth and overall financial success depend on a continued rise in transaction volumes.
Finally, PayPal also bought back $5.0 billion in shares from stockholders in 2023, repurchasing around 74 million shares of ordinary stock. Therefore, by lowering the total number of outstanding shares and raising EPS, share repurchases may improve market valuations.
Verizon (VZ)
Verizon (NYSE:VZ) is positioned for growth because of its deliberate investments in tech. With 13.1 million customers, Verizon’s introduction of myPlan has been a huge lead. That illustrates Verizon’s capacity for adaptability to changing demands to promote revenue expansion and client retention.
After concentrating on growing its fixed wireless access service, Verizon has added more than 3 million customers in only three years since its introduction. The company’s objectives of generating additional income sources and offering customers dependable broadband access align with this expansion.
Moreover, Verizon can take advantage of new possibilities in the corporate sector. Its leadership demonstrates that by offering 5G solutions to major corporations. That includes private networks for businesses like Audi and Norfolk International Terminal. Hence, these alliances help Verizon maintain its position as the market leader in 5G technology.
Finally, the strongest postpaid phone net additions in two years and a 17% year-over-year rise in gross adds in the Consumer category prove that Verizon’s segmented market approach has improved customer acquisition and retention. Therefore, Verizon’s growth goals align with its strategic capital allocation targets, including network development and spectrum expenditures like C-Band.
As of this writing, Yiannis Zourmpanos held long positions in WBD and PYPL. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
