2024 was supposed to be a year when the list of stocks to buy expanded beyond the tech sector, in general, and the Magnificent 7 stocks in particular. Well, some of the Mag 7 stocks have disappointed, but the breadth of market winners is not expanding. If anything, it’s getting smaller.
But there’s profit to be made in any market. And that profit comes from some of the hidden gems like the ones in this article. Some of these stocks carry name recognition but are still overlooked. Others are in areas of the market that are poised for expansion.
Of course, finding these stocks to buy and putting your hard-earned capital into them are two very different things. Here are three stocks that investors may want to consider if they’re looking to take some speculative risk, hedged by a bullish outlook from analysts or broader economic trends.
Palantir (PLTR)
With a stock price that’s up 191% in the last 13 months, Palantir (NYSE:PLTR) may not be what many investors view as a hidden gem. But it still seems to be overlooked by many retail and institutional investors, so it belongs on a list of stocks to buy.
Palantir is what I call a “yeah but” stock. That means every time it clears one obstacle, the critics come in and move the goalposts. Yeah, it has an impressive list of government contracts, but what about the commercial business? Yeah, it’s growing its commercial business but it’s not profitable. Sure, now it’s profitable but look at that valuation.
You see what I mean? But the common denominator is that Palantir has made some lofty projections and it’s delivering on those forecasts. The commercial business is now about 50% of revenue, but the company has shown in 2024 that the commercial growth is not taking away from its business with the U.S. government. And the company has now delivered a full year of profitable earnings.
As for the valuation, only time will tell if Palantir will grow into its valuation that is 133x forward earnings as of this writing. But one of the most vocal Palantir bulls, Dan Ives of Wedbush who has referred to Palantir as “the Lionel Messi of AI”, gives the stock a $35 price target in the next 12 months.
Amerigo Resources (ARREF)
In the last few years, investors have heard about the rising demand for copper. The U.S. Geological Studies indicate that in the history of the world to date only 700 million tonnes of copper have been produced. However, in order to meet aggressive new net zero goals by 2050 an additional 1.4 billion tonnes of copper will be needed.
It’s going to be needed for electric vehicles and renewable energy installations (including nuclear reactors) as the government tries to reach its net zero goals by 2050. Copper will also play an essential role in rebuilding our current electrical infrastructure. However, one of the growth areas that may be overlooked is the role copper will play in powering artificial intelligence (AI) data centers.
There are a number of copper stocks you can consider. But an under-the-radar copper stock on this list of stocks to buy is Amerigo Resources (OTCMKTS:ARREF). This is a small-cap Canadian company with a market cap of just over $212 million. It also trades as a penny stock. Nevertheless, it has the rights to the world’s largest underground mine in Chile.
ARREF stock will tend to move in tandem with the price of copper. That means there could be some short-term volatility. However, this is a profitable company that expects to grow earnings by 37.5% in the next 12 months. It also pays a small dividend. That’s a combination you don’t get from many penny stocks.
Qualys (QLYS)
The current and future growth of AI emphasizes the need for cybersecurity solutions. Qualys (NASDAQ:QLYS) is a name that many investors may not be familiar with, but that could change soon.
Qualys is known for its cloud-native approach to cybersecurity. The company is best known for its Enterprise TruRisk Platform which delivers critical security intelligence on demand while automating other key systems and applications.
One of the emerging cybersecurity threats is coming from credential-stuffing campaigns. This is when bad actors try to breach a company’s online services using large lists of usernames and passwords obtained through data breaches, phishing campaigns, etc.
This happens to be an area where Qualys excels. That’s one reason why the 31% drop in QLYS stock in 2024 looks like a buyable dip. Analysts maintain a $162.31 consensus price target for the stock. And the highest price of $220 would be a 64% gain from the price as of June 4, 2024.
On the date of publication, Chris Markoch had a LONG position in PLTR. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
