If you've got some cash lying around, putting it in the market is a smart idea if you don't need it for the next three to five years. Giving a stock the right time frame to compound allows it to ride out market swings and potentially double your initial investment.

Three stocks I believe can double your money within that time period are The Trade Desk (TTD 2.42%), Mercado Libre (MELI -0.81%), and Snowflake (SNOW 1.02%). Each operates in the tech sector and has strong growth prospects ahead. With $5,000, an investor can buy a few shares of each and watch them compound over the next three to five years.

Plants grow from the dirt with cash wrapped around their stems.

Image source: Getty Images

The Trade Desk

The Trade Desk operates a demand-side advertising platform. This allows businesses to advertise to targeted audiences through videos, podcast ads, and connected TV. Customers set up what audience they want to reach and their budget, and The Trade Desk's bidding platform does the rest. Additionally, users can set up direct deals with publishers through The Trade Desk if it sees particular success with one vendor. 

As the world transitions away from data tracking cookies, The Trade Desk is rolling out its own version. Unified ID 2.0 (UID2) is its solution, and it works better than its predecessor. One UID2 user saw a 20% improvement in cost per action and converted 22% more ad viewers 33% faster. Improvements on cookies will make The Trade Desk's product a must-have for users who want the most return on their advertising dollars. 

In order for a stock to double, it must produce market-beating growth. During the third quarter, The Trade Desk increased its revenue by 39%. Management is guiding for at least $388 million in Q4 revenue, representing more than 20% growth. The company also retained 95% of its customers, as it has the previous seven years.

Considering The Trade Desk's growth prospects and its answer to an important challenge across the advertisement industry, I believe it is a strong candidate for a stock that could double.

Mercado Libre

Latin America does not yet have the infrastructure to support e-commerce found in the U.S. But Mercado Libre is building practically every segment -- digital payments, an e-commerce platform, and logistics -- to bring this to fruition. Mercado Libre operates in 18 countries but derives most revenue from Brazil, Argentina, and Mexico. Latin America is far from being completely developed, giving Mercado Libre a huge growth runway.

Q3 marked the first quarter over the last five that its revenue growth wasn't more than 100%. Still, quarterly revenue came in at $1.86 billion, growing at an impressive 73% clip. Mercado Libre is not dependent on either its fintech or e-commerce business alone -- both are providing strong results. Commerce makes up a larger revenue portion because it also includes Mercado Envios, the shipping logistics business.

Metric Commerce Fintech
Revenue (Millions) $1,225 $633
Percent of revenue 66% 34%
YOY growth 74% 71%

Data source: Mercado Libre. YOY = year-over-year.

As a $59 billion market cap company down more than 40% from its high, Mercado Libre barely needs to set a new high to double as an investment. 

Snowflake

Many businesses generate mountains of data but have nowhere to store it or the methods to process and analyze it. Snowflake solves this issue by teaming up with the major cloud infrastructure providers to store it and provide data interpretation tools. The platform is automated, so the repetitive task of humans manually uploading data is eliminated.

Snowflake's growth and customer expansion are second to none. During its FY 2022 third quarter ending in October, it grew revenue to $312.5 million at a 110% clip. Its net revenue retention rate was an incredible 173%, meaning existing customers spent 73% more during this time frame than last. Most importantly, businesses spending $1 million or more grew by 128% to 148. These customers are also highly satisfied with Snowflake; its Dresner Customer Satisfaction score was 100%. The company has also enjoyed a 612% return on investment over three years. With incredible results like this, Snowflake remains a compelling investment.

The biggest risk with Snowflake is its valuation; it trades at more than 100 times sales. Still, a company with absurd growth rates and top-notch customer satisfaction should be considered. If it continues growing as it has, Snowflake could double in a three to five-year period.

Three stocks to be optimistic about

At more than $1,000 per share, Mercado Libre's stock price is significantly higher than the other two. However, Buying one Mercado Libre share for around $1,000 and 10 Trade Desk shares for $100 provides the same return potential, even though you own fewer shares. If each rises 10%, an investor makes $100. (Yes, it may be more appealing owning 10 shares versus one, but what matters is the dollar amount invested in each stock.)

All three companies are growing quickly and are operating in growing market segments. Buying each of these stocks and holding for a three to five-year time period could double an initial investment. These stocks will still exhibit significant price swings, so investors shouldn't get frightened if the stock temporarily drops. If The Trade Desk, Mercado Libre, and Snowflake continue their growth trajectories, investors will find few better places to put their money.