Two Notable Shares to Purchase in January and Maintain for Two Decades
Unlocking wealth in the stock market isn't as complicated as you might think. The trick is to invest in growing companies that still have vast expansion opportunities. Here are two such stocks with massive return potential:
1. Dutch Bros
Dutch Bros (BROS -1.27%) is a rapidly expanding beverage chain that's distinguishing itself with a unique blend of offerings. Though half its menu is coffee-based, it's setting itself apart from giants like Starbucks with a diverse range of drinks, such as lemonade, smoothies, and sparkling sodas.
Founded by brothers Dane and Travis Boersma in 1992, Dutch Bros went public in 2021. After some underperformance, the stock now trades at a more reasonable valuation, making it an attractive investment opportunity as the company continues to expand across the U.S.
In the third quarter, revenue surged 28% year over year, reaching 950 locations across 18 states. With room to grow, Dutch Bros is opening new locations with profitability and discipline, achieving $22 million in net income in each of the last two fiscal quarters.
Same-shop sales grew 2.7% year over year, consistent with the moderate growth of existing shops. This methodical expansion and steady performance make Dutch Bros an appealing option for those looking to build wealth in the stock market. With 32 remaining U.S. states yet to see a Dutch Bros shop, there's plenty of growth potential to fuel monster returns over the next two decades.
2. Coupang
Coupang (CPNG -1.17%) is South Korea's premier e-commerce store, often compared to Amazon. Coupang has built a unique advantage in serving densely populated areas, which could give it an edge as it expands. Over the past year, the stock has shot up 30%.
Coupang boasts 22.5 million active customers, with active users jumping 11% year over year in the third quarter. Revenue increased at a high double-digit rate due to increased spending from existing customers and a growing user base.
Its standout fulfillment infrastructure can deliver 99% of orders within one day, even in densely populated areas like Seoul, South Korea. Coupang's Dawn delivery service offers exceptional convenience, allowing customers to place orders by midnight and receive them by 7 a.m. the next day.
Although Coupang may face challenges competing with Amazon in the U.S., it has already achieved success in Taiwan and could expand to other markets. Existing customers in South Korea are generating most of the company's growth, but there is still potential to grow sales from the current customer base as Coupang expands its product selection.
Coupang's competitive valuation, with a reasonable forward P/E ratio of 42.35, makes it a promising investment opportunity with the potential to generate excellent returns.
While both stocks show strong growth prospects, Dutch Bros captures attention with its exceptional revenue growth and strategic shifts, while Coupang boasts significant revenue growth and high valuation metrics. However, Coupang's short interest and upcoming earnings release may have a significant impact on its stock performance.
Investing in Dutch Bros could be a smart finance move due to its impressive revenue growth, reaching 950 locations and surpassing $22 million in net income. The company's reasonable valuation and ongoing expansion make it an attractive money-making opportunity.
Coupang's booming e-commerce business in South Korea, with a 99% one-day delivery rate, offers a potential high return on investment. Its competitive valuation, coupled with its success in Taiwan and expansion potential, makes it an appealing stock to consider for those seeking profitable finance options.
