Please ensure Javascript is enabled for purposes of website accessibility

3 Stocks That Could Double Your Money

By Selena Maranjian - Feb 20, 2021 at 6:06AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

You'll find some double-digit and triple-digit growth rates in here.

It's not that hard to double your money -- if you have enough time. Even with a minuscule growth rate, you can double your money over hundreds or thousands of years. When it comes to stocks, even one growing at 4% annually will more than double over 20 years. But you probably clicked into this article looking for faster growers than that, right?

Here are three companies that could double your money -- potentially within just a few years. See if any of them interest you as candidates for your long-term portfolio.

A woman is smiling and holding some $50 bills fanned out.

Image source: Getty Images.

1. General Electric

General Electric (GE 0.01%) has been undergoing a transformation over recent years, selling off its appliances business, spinning off its consumer credit card operations (as Synchrony Financial), and focusing primarily on its aviation, healthcare, and energy operations. Still, the pandemic delivered a blow, with much of its business slowing or stalling and total revenue for 2020 down 16% year over year. But the company has been steadily paying down debt and sees brighter days ahead, as more orders come in for aviation products due to the pandemic winding down and orders for renewable energy offerings such as wind turbines start rolling in, as well.

GE chairman and CEO Larry Culp summed up the company's year saying: "As 2020 progressed, we significantly improved GE's profitability and cash performance despite a still-difficult macro environment. The fourth quarter marked a strong free cash flow finish to a challenging year, reflecting the results of better operations as well as strong and improving orders in Power and Renewable Energy."

General Electric had been a longtime payer of meaningful dividends, but it slashed its payout by 90% a few years ago, when it was struggling. It has been slowly growing it again, and its dividend recently yielded 0.34%. If its free cash flow remains solid and keeps growing, it won't be surprising to see significant dividend increases ahead. That, along with stock-price appreciation, should help the stock double investors' money.

2. Pinterest

Pinterest (PINS 9.56%) shares surged more than 250% in 2020, and recently sported a price-to-earnings (P/E) ratio topping 200. So yes, this stock has priced in some great expectations. Thus, it may not double in the near future -- but its long-term future appears quite promising. The company's platform allows users to share visual inspirations of foods, fashions, styles, crafts, home decor, and more. There are a lot of these users, too -- more than 450 million, in fact, who use the site at least monthly. Altogether, users have saved close to 300 billion "pins."

The company has a terrific business model, as it's capital-light: The site already exists and it costs relatively little to support many more users. It's reaping profits from digital advertising on its site, and unlike many other sites, where users find ads annoying, on Pinterest users are looking for ideas that many ads offer. If they have pinned many home decor items, they will likely be extra receptive to ads for home decor items.

In Pinterest's last quarter, its revenue surged 76% year over year, with net income soaring 682%. You can't expect such growth rates to continue for long, but the company does project a 70%-plus year-over-year growth rate for revenue in the coming first quarter. Such growth rates can make a steep P/E ratio more palatable -- especially for long-term investors. This is a very promising company with a bright future. If Pinterest is able to further monetize its huge user base, that can be a powerful catalyst for further growth.

3. Zynga

Mobile video game specialist Zynga (ZNGA -2.04%) is another company with a good shot at doubling in value within a handful of years. You may be familiar with some of its offerings: Words With Friends, Zynga Poker, CSR Racing, Empires & Puzzles, Toon Blast, Toy Blast, Merge Dragons, and Merge Magic.

Zynga recently reported a strong 2020, with revenue up 49% year over year and operating cash flow rising 63%, and cash and investments topping $1.5 billion. The company has already been acquiring other businesses with existing game franchises, and that cash pile can finance further buys. The company is eying Asia to boost its top and bottom lines, and it's also aiming to increase in-game purchases by players.

Like Pinterest, Zynga's shares may not appear cheap, but the company's forward-looking P/E ratio was recently only in the 30s, and its recent price-to-sales ratio near six was only about 36% higher than its five-year average. Conservative investors might seek more clearly undervalued stocks than Pinterest and Zynga, but risk-tolerant ones can justify the premium prices with the rapid growth rates.

A little time digging around online can turn up many more portfolio candidates capable of doubling in value over the course of a few years. You might want to dig deeper into one or more of these three companies, too.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Zynga Inc. Stock Quote
Zynga Inc.
$8.18 (-2.04%) $0.17
General Electric Company Stock Quote
General Electric Company
$74.53 (0.01%) $0.01
Synchrony Financial Stock Quote
Synchrony Financial
$33.94 (3.13%) $1.03
Pinterest Stock Quote
$18.90 (9.56%) $1.65

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/26/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.