These stocks could deliver big gains for investors if things go well.
Of course, nobody knows for sure what stocks will deliver 10X returns over the next several years -- if we did, we'd all be rich! However, there are some stocks whose 10X potential our experts feel quite strongly about. In thisFool Livevideo clip, recorded on May 14, Fool.com contributors Matt Frankel, CFP, and Jason Hall, along with chief growth officer Anand Chokkavelu, discuss three stocks they all own that they feel have 10-bagger potential.
Anand Chokkavelu: Let's get on to "most likely to 10x," if any.
Matt Frankel: Seritage (NYSE:SRG)is the cheating answer just because it's so small. Market cap well under $1 billion. With 26 million square feet of space, not including their land, it wouldn't be inconceivable for them to build that into a $7 billion business if things go well, the big if at this point. Excluding Seritage, I'd say my No. 1 to 10x isPinterest (NYSE:PINS). I think it can easily 10x its monetization from here.
Jason Hall: Seritage, I think is maybe the most binary. The other factor of it to be a 10x investment is eventually getting dividends. It gets the scale, it manages to get through this period of business-building without having to sell off its best assets and ruin the returns. This could be an incredible over the next 10 years. It could turn into a huge income growth stock, too, when you start thinking about total returns. I think I would agree with Seritage. I'm going to sayMercadoLibre(NASDAQ:MELI)over Pinterest. Because even though it peaked at around $100 billion, it's still less than $70 billion in market cap. The optionality in that business, the foothold they already have in Latin America, the demographics in Latin America that are going to drive its opportunity -- don't sleep on MercadoLibre being a trillion-dollar company in a decade.
Frankel: In addition to the most likely, I'd like to know both of your lease likely to 10x, too. I know Anand hasn't answered so you could add that to yours. I'd sayDisney(NYSE:DIS)is least likely to 10x from here.
Hall: Yeah. I want to hear what Anand says and then that way I can cherry-pick.
Chokkavelu: No. It was the same. In terms of least likely is Disney because just because it's over a $300 billion market cap.
Hall: What do you think about your first?
Chokkavelu: First. This is a tough one. I was really curious to see what Matt would say on Seritage. It's not an as-a-service company, so it's harder to tell us it's a real 10x-er or five x-er. Certainly because, yeah, it's the only one under $1 billion.Appian's(NASDAQ:APPN)probably got a lot of upside just because it's a $5 billion dollar company.
Hall: Yeah.
Chokkavelu: MercadoLibre and Pinterest are both in that middleweights type of thing where Pinterest is like $30-40 billion dollar market cap, MercadoLibre's $65 billion. But both of them, I could see 10x-ing. Square(NYSE:SQ)is interesting where it's $100 billion. Could it be a trillion? Maybe, but that one's a little harder than MercadoLibre and Pinterest to imagine.
Hall: That's more than double the size of JPMorgan Chase. That's a big bite. That's a very big bite.
Chokkavelu: Cherry-pick away, Jason.
Hall: I don't know, man. This is least likely to. I think I'm going to default to Disney, I really do. Again, just because of the size and thinking even with the addressable market. I mean, it's already eaten up so much in the entertainment industry.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.