As we enter 2024, the market is fully valued with the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) at high trailing earnings. Thus, identifying growth opportunities becomes increasingly compelling. Below, we will introduce three under-the-radar stocks in 2024 poised for mind-blowing growth.
These “rising stars” are not your typical headline dominators like the Magnificent Seven stocks. Instead, they are companies that have been quietly and diligently building their foundations. They are innovating in their markets and have positioned themselves for secular growth.
Each stock has created a unique blend of innovation in a specific market niche. As a result, they have outpaced the revenue growth of their respective sectors. Due to their outstanding growth, they are just beginning to gain recognition among investors.
What’s more, they are set to make significant strides in 2024 with exciting expansion initiatives in their pipeline. Below, we shed light on these three exceptional stocks. We highlight their journey thus far and why they stand out as candidates for remarkable growth in the upcoming year.
Celsius Holdings (CELH)
Celsius Holdings (NASDAQ:CELH), the energy drinks maker, has seen a tremendous rise from its humble beginnings. Gradually, it has gained a share and now is the third-largest energy drink seller in the U.S. Yet its surge has just begun, and more revenue awaits with international expansion.
The company is already expanding internationally to capitalize on the untapped market. On January 22, it announced an international expansion drive to Canada, the United Kingdom, and Ireland. PepsiCo (NASDAQ:PEP) will be its exclusive distributor in Canada. In the U.K., the Republic of Ireland, and Northern Ireland, Suntory Beverage & Food Great Britain and Ireland (OTCMKTS:STBFY) will be the distribution partners.
If Celsius ramps up its international expansion efforts further, it will easily surpass Wall Street’s 38% revenue growth expectations. Today, international sales represent under 5% of total revenues, highlighting the tremendous opportunity for this energy drink maker.
On Holding AG (ONON)
With its innovative products, On Holding AG (NYSE:ONON) is disrupting the running, training, and tennis footwear space. Despite its early success, it has plenty of untapped potential it can capitalize on.
First, to boost sales, the company is raising brand awareness by focusing on athletes to market its premium brand image. Athletes like Helen Obiri – who won the Boston and New York City marathons wearing On’s CloudTri 1 – have popularized the brand. Furthermore, the company is rolling out its retail store concepts to raise awareness about its brand.
The company also plans to expand through multichannel partners and add to its product assortment. It is expanding its geographic footprint with partners like DICK’S Sporting Goods (NYSE:DKS). On the product side, the company plans to launch training apparel for the gym, studio, and the outdoors.
During the investor day in October 2023, management outlined a plan to double net sales in the next three years. Building on 2023’s over 44% growth, management expects 26% annual growth over the next three years. This growth, plus an expansion of adjusted margins to over 18% by 2026, presents a compelling under-the-radar stocks 2024 story.
AppFolio (NASDAQ:APPF) just had one of its best days on January 26. After a blowout quarter, the stock surged over 28%, breaking out to an all-time high. The fundamentals and solid guidance mean this stock could rocket higher.
So, what got the market excited about APPF stock? Q4 2023 earnings for this real estate and property management software platform were outstanding. Revenues grew 39% year-over-year to $172 million, bringing full-year revenues to $620 million, a 31% increase.
CEO Shane Trigg highlighted the focus on profitable growth. “I am pleased to announce a successful fourth quarter that caps off a year in which AppFolio increased the pace of innovation while prioritizing profitable growth,” he noted.
Management also provided a rosy outlook for 2024, predicting revenues of $755 million to $765 million, at least 21% growth. They also expect non-GAAP operating margins to improve from 12.2% of revenue to between 21 and 23%.
AppFolio is one of the best under-the-radar stocks 2024 to buy. It is building a leading platform for the real estate market. With impressive revenue growth and improving profitability, APPF stock will continue higher.
On the date of publication, Charles Munyi had long positions in CELH and ONON but did not hold (either directly or indirectly) any positions in other securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.