Dividend Stocks

3 Under-$30 Growth Stocks to Buy for 3-Bagger Returns by 2026

Back in 2021, growth stocks had skyrocketed. One reason for the rally was easy money policies and as interest rates increased, growth readjustments translated into correction for some of the best growth stocks. However, with the likelihood of multiple interest rate cuts in the next 12 to 24 months, I am bullish on another big rally for growth stocks. The focus of this column is on under-$30 growth stocks to buy that can deliver 3-bagger returns in 24 months.

The first two stocks discussed in the column represent companies investing significantly in expansion. These companies are likely to witness stellar revenue and EBITDA growth. That’s the key catalyst for stock upside. Further, the third company discussed is a potential turnaround story after a deep correction in the last few years.

Let’s discuss the business and balance sheet fundamentals that are likely to support a big rally for these under-$30 growth stocks.

Marathon Digital (MARA)

In this photo illustration, the Marathon Digital Holdings (MARA) logo seen displayed on a smartphone screen

Source: rafapress / Shutterstock.com

Marathon Digital (NASDAQ:MARA) stock has trended higher by 64% in the last 12 months. I however believe that the best part of the rally is still to come for this Bitcoin (BTC-USD) miner. My view is backed by the point that Marathon has some big expansion plans. With a bullish outlook for Bitcoin, the hash rate capacity expansion is likely to translate into stellar growth.

As of Q1 2024, Marathon reported energized hash rate growth of 142% on a year-on-year basis to 27.8EH/s. By the end of the year, the miner is targeting to boost its hash rate to 50EH/s. This expansion provides clear revenue and EBITDA growth visibility.

From a fundamental perspective, Marathon reported a cash buffer (including digital assets) of $1.6 billion as of Q1. Thisprovides ample flexibility for pursuing aggressive expansion. Recently, Marathon announced diversification with mining operations for Kaspa. The latter is the fifth largest proof-of-work digital asset by market capitalization. Therefore, with multiple positive developments and a strong balance sheet, MARA stock is positioned to surge higher.

Miniso Group (MNSO)

red Miniso (MNSO) sign glowing at night

Source: shutterstock.com/Hendrick Wu

Miniso Group (NYSE:MNSO) is engaged in the retail and wholesale of lifestyle products in China and globally. The company provides high-quality lifestyle goods at an attractive price. Further, the product portfolio is dynamic with the regular launch of new SKUs. These are the key differentiating factors for Miniso and have translated into healthy growth.

The growth momentum is reflected in MNSO stock which has trended higher by 10% in the last 12 months. However, a forward P/E of 15.3 indicates that the lifestyle retailer is trading at a valuation gap. I expect a big rally from current levels.

From a growth perspective, Miniso is targeting aggressive expansion of its retail stores. Between 2024 and 2028, the company plans to open 900 to 1,100 stores annually. This will ensure healthy top-line growth. At the same time, EBITDA margin expansion is likely to sustain. For Q1 2024, Miniso reported adjusted EBITDA margin of 25.9%, which was higher by 200 basis points on a year-on-year basis.

I must add here that Miniso initiated dividends last year and the current yield is attractive at 2.1%. Considering the top-line outlook, I expect healthy dividend growth in the next few years.

Rivian Automotive (RIVN)

Rivian (RIVN) logo is seen at a Rivian service center in South San Francisco, California. Rivian Automotive, Inc. is an electric vehicle automaker.

Source: Tada Images / Shutterstock.com

Electric vehicle stocks have seen a deep correction in the last few quarters. The negative factors include macroeconomic headwinds and intense competition. I see this as a good opportunity to accumulate quality EV names.

Rivian Automotive (NASDAQ:RIVN) stock was listed towards the end of 2021 and surged to highs of $172. However, the positive momentum was short-lived and the stock plunged to its current level of $14.50. With the EV company recently striking a deal with Volkswagen (OTCMKTS:VWAGY), I am bullish on a sustained rally.

As a part of the deal, Volkswagen will be investing $5 billion in Rivian for an equally controlled joint venture. The dealincludes sharing EV architecture and software. The investment will provide Rivian with funding for R2 (less expensive SUV) and R3 crossover.

Further, Volkswagen is likely to launch 25 new EV models in the United States by 2030. The partnership is therefore likely to create long term value besides proving Rivian with the much-needed cash infusion.

On the date of publication, Faisal Humayun did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Faisal Humayun is a senior research analyst with 12 years of industry experience in the field of credit research, equity research and financial modeling. Faisal has authored over 1,500 stock specific articles with focus on the technology, energy and commodities sector.

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