Investing in large-cap stocks has proven to be a successful strategy for investors seeking growth while preserving stability. However, large-cap companies often experience less explosive growth than their smaller counterparts. One strategy to bridge the difference is to evaluate mid-cap stocks poised to join the coveted large-cap sector.
Over 50 stocks are currently within $1 billion of reaching the $10 billion milestone, implying only an 11% price growth to join the large-cap stocks club. However, determining which of the forthcoming large stocks to buy requires analyst recommendations as there is a preference for not just meeting but also sustaining large-cap status. After all, temporarily surpassing the $10-billion mark and then retreating provides little benefit.
Several mid-caps are predicted to experience significant growth over the next year, warranting examination. So let’s explore three (almost) large-cap stocks to buy that are also expected to remain among the large-cap stocks. Those three stocks nearing the $10 billion mark are highlighted below.
Wynn Resorts (WYNN)
Source: Richie Chan / Shutterstock.com
While once considered a member of the large stock club, Wynn Resorts (NASDAQ:WYNN) is now viewed as a mid-cap stock due to global economic trends that have shifted investor focus.
The company operates casinos and hotels in Las Vegas and Macau. The Macau operations are particularly exposed to China’s economic conditions, which helps explain WYNN’s share price decline over the past month. This occurred despite reporting quarterly earnings that beat estimates. Most of the company’s revenue growth came from gambling, indicating this high-margin sector may be slowing.
Still, longer-term analysts remain optimistic. Two analysts raised their outlook for Wynn Resorts last month. Growth estimates see a 33% increase for the current quarter and 17.20% for the next quarter.
The average price target for WYNN stock is $126 per share, implying a 37% upside. With a current market capitalization of $9.95 billion, achieving this growth would easily return Wynn to its old status,.
VinFast Auto (VFS)
Source: T. Schneider / Shutterstock.com
VinFast Auto (NASDAQ:VFS), the Vietnamese electric vehicle (EV) manufacturer, represents another opportunity among soon-to-be large-cap stocks to buy. As an emerging market company, it involves greater risk but higher potential returns for investors seeking international growth.
Also, VinFast Auto entered the public market less than one year ago through a Special Purpose Acquisition Company (SPAC). Some traders may feel uneasy due to the company’s limited performance history as a publicly traded corporation.
Also, VFS stock price has declined 50% year-to-date (YTD) after the company missed elevated delivery targets earlier this year. Share prices in American Depository Shares (ADS) can fluctuate sharply in response to business updates.
Still, analysts have a positive outlook for the company’s future potential and recommend a buy. The average price target stands at $8.50 per share, representing over a 100% increase from current levels. VinFast Auto currently has a market capitalization of $9.68 billion. Reaching the average analyst target would result in a market value comfortably in the large capitalization category.
Duolingo (DUOL)
Source: dennizn / Shutterstock
The largest online learning application known for its class reminders saw solid growth over the past year. Duolingo’s (NASDAQ:DUOL) subscription bookings grew 47% during this period, allowing for over a tenfold increase in EPS. In Q1, the company performed so well that it increased its sales and EBITDA guidance for the full year.
Despite the strong performance, DUOL share price started and ended the year around the same value after experiencing volatility. This is likely because while the company has a strong long-term forecast, short-term traders may have been disappointed it prioritized growth over rewarding shareholders through dividends or share buybacks.
Analysts with a long-term view remain positive on the company, maintaining a price target of $251.10 per share. This represents an almost 19% increase. With a current market capitalization of $9.14 billion, achieving this growth could firmly place the company in the large-cap stocks to buy category, especially if Its share price keeps pace with sales growth.
On the date of publication, Stavros Tousios did not have (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.
Stavros Tousios, MBA, is the founder and chief analyst at Markets Untold. With expertise in FX, macros, equity analysis, and investment advisory, Stavros delivers investors strategic guidance and valuable insights.
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The post Large-Cap Alert: 3 Stocks Set to Join the Coveted Billion-Dollar Club appeared first on InvestorPlace.
Investing in large-cap stocks has proven to be a successful strategy for investors seeking growth while preserving stability. However, large-cap companies often experience less explosive growth than their smaller counterparts. One strategy to bridge the difference is to evaluate mid-cap stocks poised to join the coveted large-cap sector.Over 50 stocks are currently within $1 billion of reaching the $10 billion milestone, implying only an 11% price growth to join the large-cap stocks club. However, determining which of the forthcoming large stocks to buy requires analyst recommendations as there is a preference for not just meeting but also sustaining large-cap status. After all, temporarily surpassing the $10-billion mark and then retreating provides little benefit.
Several mid-caps are predicted to experience significant growth over the next year, warranting examination. So let’s explore three (almost) large-cap stocks to buy that are also expected to remain among the large-cap stocks. Those three stocks nearing the $10 billion mark are highlighted below.
Wynn Resorts (WYNN)
Source: Richie Chan / Shutterstock.comWhile once considered a member of the large stock club, Wynn Resorts (NASDAQ:WYNN) is now viewed as a mid-cap stock due to global economic trends that have shifted investor focus.
The company operates casinos and hotels in Las Vegas and Macau. The Macau operations are particularly exposed to China’s economic conditions, which helps explain WYNN’s share price decline over the past month. This occurred despite reporting quarterly earnings that beat estimates. Most of the company’s revenue growth came from gambling, indicating this high-margin sector may be slowing.Still, longer-term analysts remain optimistic. Two analysts raised their outlook for Wynn Resorts last month. Growth estimates see a 33% increase for the current quarter and 17.20% for the next quarter.
The average price target for WYNN stock is $126 per share, implying a 37% upside. With a current market capitalization of $9.95 billion, achieving this growth would easily return Wynn to its old status,.
VinFast Auto (VFS)
Source: T. Schneider / Shutterstock.comVinFast Auto (NASDAQ:VFS), the Vietnamese electric vehicle (EV) manufacturer, represents another opportunity among soon-to-be large-cap stocks to buy. As an emerging market company, it involves greater risk but higher potential returns for investors seeking international growth.
Also, VinFast Auto entered the public market less than one year ago through a Special Purpose Acquisition Company (SPAC). Some traders may feel uneasy due to the company’s limited performance history as a publicly traded corporation.
Also, VFS stock price has declined 50% year-to-date (YTD) after the company missed elevated delivery targets earlier this year. Share prices in American Depository Shares (ADS) can fluctuate sharply in response to business updates.Still, analysts have a positive outlook for the company’s future potential and recommend a buy. The average price target stands at $8.50 per share, representing over a 100% increase from current levels. VinFast Auto currently has a market capitalization of $9.68 billion. Reaching the average analyst target would result in a market value comfortably in the large capitalization category.
Duolingo (DUOL)
Source: dennizn / ShutterstockThe largest online learning application known for its class reminders saw solid growth over the past year. Duolingo’s (NASDAQ:DUOL) subscription bookings grew 47% during this period, allowing for over a tenfold increase in EPS. In Q1, the company performed so well that it increased its sales and EBITDA guidance for the full year.
Despite the strong performance, DUOL share price started and ended the year around the same value after experiencing volatility. This is likely because while the company has a strong long-term forecast, short-term traders may have been disappointed it prioritized growth over rewarding shareholders through dividends or share buybacks.Analysts with a long-term view remain positive on the company, maintaining a price target of $251.10 per share. This represents an almost 19% increase. With a current market capitalization of $9.14 billion, achieving this growth could firmly place the company in the large-cap stocks to buy category, especially if Its share price keeps pace with sales growth.
On the date of publication, Stavros Tousios did not have (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.
Stavros Tousios, MBA, is the founder and chief analyst at Markets Untold. With expertise in FX, macros, equity analysis, and investment advisory, Stavros delivers investors strategic guidance and valuable insights.More From InvestorPlace
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The post Large-Cap Alert: 3 Stocks Set to Join the Coveted Billion-Dollar Club appeared first on InvestorPlace. Read MoreNASDAQ:WYNN,NASDAQ:VFS,NASDAQ:DUOL, Stocks to Buy
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