In a recent CNBC report, it was highlighted that a $1,000 investment in Monster Beverage on February 14, 1994, would have yielded a staggering return of approximately $2 million on its 30-year anniversary, showcasing the potential for long-term growth in certain cheap stocks. The success of Monster Beverage can be attributed to the visionary leadership of co-CEOs Rodney Sacks and Hilton Schlosberg, who built the energy drink empire through their expertise in running a business.
Drawing inspiration from this remarkable success story, we present three other companies with visionary leaders who possess the confidence and patience to nurture their ideas until they become significant successes.
First on the list is DLocal, a Uruguayan fintech company founded in 2016. DLocal aimed to disrupt online payments in emerging markets. However, the company’s share price has experienced a significant decline of 53% year-to-date in 2024 due to slipping gross profit margins. Despite this setback, DLocal’s total payment volume increased by 49% in Q1 2024 to $5.3 billion. Notably, the company’s revenue in the Egypt market skyrocketed 11-fold in the same quarter, indicating a potential diversification away from its reliance on Latin America. With shares trading at just over $8, DLocal presents an opportunity for investors seeking cheap stocks.
Next, we have HighPeak Energy, which owns a vast land area of over 100,000 acres in the Midland Basin in Texas. Led by Texas oil and gas veteran Jack Hightower, HighPeak Energy has demonstrated impressive operating margins compared to its peers in the Permian region. Over the past five years, the company’s shares have returned 110%, outperforming industry giant Exxon Mobil. In its Q1 2024 results, HighPeak Energy reported a 29% increase in operating revenue and a 16% rise in operating income compared to the previous year. With a favorable valuation and trading at just under $16, HighPeak Energy is another attractive option for investors looking for cheap stocks with potential.
Lastly, Iris Energy, a Bitcoin miner, has faced recent criticism from short seller Culper Research, questioning the company’s plans to venture into artificial intelligence (AI). Culper Research argues that Iris Energy’s data centers lack the capacity to support high-performance computing, suggesting that the AI pivot is a diversion from the declining profitability of Bitcoin mining. However, Bernstein, a research firm, initiated coverage of Iris Energy with an “outperform” rating, highlighting the company’s potential as an attractive partner for building AI data centers due to its available electric power. Bernstein predicts that 15% of Iris Energy’s power capacity will be allocated to AI data centers and co-hosting situations. With a target price of $26, more than double its current trading value, Iris Energy presents an intriguing opportunity for investors.
While these companies may face challenges and uncertainties, their visionary leaders and unique market positions make them worth considering for long-term investment. As with any investment, thorough research and analysis are essential before making any decisions.