Investing in companies in their first year of public trading can be an exciting and risky proposition. Before the market can get a clear picture of its actual value, it may take time for enough information to become available about a new stock, leading to volatility. Stocks can see big ups and big downs as investors add more and more detail to the picture around the company. Below, I’ll detail three stocks that have found themselves on the right side of this equation, rewarding those who got in early.
Reddit is taking the market by storm
Reddit today
(As of 3:23 p.m. ET)
- 52 week range
- $37.35
▼
$158.49
- Target price
- $91.67
Reddit New York Stock Exchange: RDDT has generated total returns of more than 300% since the company’s initial public offering (IPO) on March 20. The communications services business revolves around Reddit.com, which has over 100,000 discussion forums on various topics. Users refer to each discussion board as a subreddit. Users can read and post on these subreddits, sharing and receiving information that interests them. The company primarily generates revenue from advertising sales on these subreddits.
While there is nothing original or innovative about Reddit and its business model, the site is thriving. For many, it has become the de facto source when searching for informal or personal information on the Internet. For example, on the r/BeyondTheBump subreddit, users share advice about the transition from pregnancy to parenthood. The platform has become extremely popular, with more than 250 million unique users visiting it every week. With so many users, it’s no surprise that advertisers want to buy space on it. Additionally, each subreddit’s niche allows companies to target advertising to their most receptive customers.
The company demonstrated extremely strong and accelerating revenue growth. In the first quarter, revenue grew 48% year over year. In the third quarter, this figure reached 68%. The company also easily beat revenue estimates.
Amer Sports: Finnish sporting goods company takes the stage
Amer Sport today
Amer Sports
(As of 3:23 p.m. ET)
- 52 week range
- $10.11
▼
US$24.74
- Target price
- $21.43
Amer Sports New York Stock Exchange: HOW Since going public on March 7, profits have increased by a staggering 500%. The company produces sportswear and sports equipment. Its three segments are technical wear, outdoor performance and ball and racket sports. Amer owns and operates well-known brands such as Arc’teryx, Salomon, Wilson and Louisville Slugger. The stock jumped an incredible 235% on its first day. At the time, only institutional investors had access, but the stock continued to rise throughout the year.
Beating revenue estimates and recording positive adjusted earnings in three of the four quarters of 2024 boosted sentiment around the company. The technical apparel segment, led by Arc’teryx, was particularly impressive. The segment increased revenue by more than 30% in each quarter compared to the previous year.
Even more impressive is the revenue growth in certain regions. In Greater China and Asia Pacific, revenue grew 56% and 47%, respectively, last quarter. The company also increased revenue from its direct-to-consumer sales channels by approximately 40%. This helps increase profits by eliminating wholesale intermediaries. In the third quarter, adjusted gross profit and adjusted operating profit increased several hundred basis points year-over-year.
Nano immediately begins to ride the wave of small modular reactors
Nanonuclear energy today
Nanonuclear energy
(As of 09:04 am ET)
- 52 week range
- US$3.25
▼
$37.51
- Target price
- $58.00
Nano nuclear NASDAQ: NNE have risen an incredible 740% since going public in May. Like Nano, NuScale Power SNEEZ: SMR shares have soared this year. This is due to the potential of small modular reactors (SMRs), which these companies are working to commercialize. The rise of artificial intelligence has meant that data centers need reliable, clean power, which is exactly the type of power that nuclear reactors can provide.
However, there is one big problem: traditional nuclear reactors are extremely expensive and take a long time to build. Analysts hope that SMRs will be able to reduce the initial cost and shorten the time frame for increasing nuclear power capacity. However, this technology has not yet proven cost-effective, and no SMRs are operational in the United States to date. As a result, Nano’s income is $0.
Nano is still in the very early stages of its journey to building and operating the reactor. It filed patent applications in 2024 and is discussing its reactor designs with the Nuclear Regulatory Commission. In August, the company acquired a facility with an area of 14,000 square meters. ft., which will become the nuclear technology headquarters. The company is also working to become a player in nuclear fuel transportation and nuclear energy consulting services.
Before you consider Reddit, you should hear this.
MarketBeat tracks Wall Street’s top-rated and best-performing analysts daily and the stocks they recommend to their clients. MarketBeat has identified five stocks that top analysts are quietly whispering to their clients to buy now, before the broader market takes hold… and Reddit wasn’t on the list.
While Reddit currently has a Moderate Buy analyst rating, the top-rated analysts consider these five stocks to be Strong Buys.
View five stocks here
Growth stocks offer great bang for your buck, and we have the following future superstars that are definitely worth considering for your portfolio.
Get this free report