In 11 days, Wall Street will turn the page on what looks to be another stellar year. Through Dec. 15, the benchmark S&P 500 has gained 25%. That's well over double its average annual total return for the past four decades.
But even with the broader market seemingly a stone's throw from yet another all-time high, plenty of bargains can still be found for patient investors. Arguably the biggest moneymaking opportunity that awaits is the potential to buy revolutionary stocks at a discount. These are companies shaking up or reshaping their respective industries.
Best of all, with most online brokerages ditching minimum deposit requirements and trading commissions, any amount of money -- even $500 -- can be the perfect amount to generate huge returns. If you've got $500 ready to invest, the following three revolutionary stocks can be bought right now.
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CrowdStrike Holdings
Over the next decade, cybersecurity might be the safest double-digit growth trend. In the wake of the pandemic, businesses have shifted their data into the cloud at an expedited rate. This means third-party cybersecurity providers are being leaned on now more than ever to keep enterprise and customer data safe. Leading that charge is CrowdStrike Holdings (CRWD -3.90%).
CrowdStrike is powered by its revolutionary security platform, Falcon. Falcon is cloud-native and reliant on artificial intelligence to grow smarter over time. In other words, being built in the cloud allows Falcon to be nimbler than on-premises security solutions at recognizing and responding to potential threats. Although cloud-native platforms are costlier up front than most on-premises solutions, the superior data protection CrowdStrike provides its clients often makes Falcon the less-expensive option over the long run.
The subscription growth for CrowdStrike tells investors everything they need to know about this innovator. In less than five years, the company has ramped from 450 subscribing customers to nearly 14,700. Over this span, we've watched the percentage of clients that have purchased four or more cloud-module subscriptions grow from a high single-digit number to 68%, as of the latest quarter. CrowdStrike isn't just attracting new clients. It's also seeing a majority of its existing clients add onto their initial subscription(s).
The beauty of this operating model is that subscription revenue is high margin and it provides predictable quarterly cash flow. CrowdStrike remains very early in its growth cycle, yet it's already hit its long-term subscription gross margin target of 77% to 82%.
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Planet 13 Holdings
Cannabis is another rapidly growing industry that has the potential to show investors "the green" over the next five to 10 years. However, cannabis is a commodity that's been around a long time. It's not exactly something folks would describe as revolutionary. But U.S. marijuana stock Planet 13 Holdings (PLNH.F -6.00%) aims to change that view.
The game plan for most multi-state operators (MSOs) is pretty simple: Open dispensaries in high-dollar markets and control the seed-to-sale process to oversee quality and lift margins. Planet 13 isn't designed to operate like a run-of-the-mill MSO.
Currently, it has just two operating dispensaries. Compare this to other large-scale MSOs that are approaching, or have more than, 100 operating locations. The differentiating factor is that Planet 13 is focused just as much on the experience for cannabis customers as it is on making a sale. The Las Vegas SuperStore, located just west of the Strip, spans 112,000 square feet (that's bigger than the average-sized Walmart) and features an event center, café, immersion station, and consumer-facing processor center. The other dispensary is located in Orange County, Calif., and spans 55,000 square feet, with 16,500 square feet devoted for selling.
With plans to expand to Chicago, Orlando, and Miami, Planet 13's management team understands how important the tourist industry can be for its business. And yet, the pandemic also taught Planet 13 about the importance of reaching out to local residents. With the company's flagship Las Vegas SuperStore now successfully courting locals and travelers, Planet 13 looks to be on the cusp of recurring profitability.
Image source: Getty Images.
Lovesac
When I say "revolutionary," the absolute last thing that probably comes to mind is furniture stocks. That's because the industry is stodgy and about as exciting as watching paint dry. It's a bunch of brick-and-mortar stores that are reliant on foot traffic and buying similar third-party merchandise. But within this maddeningly boring industry is a company shaking things up like never before. Investors, say hello to Lovesac (LOVE 2.21%).
One thing that makes Lovesac a different breed than its peers is its modular furniture. The company's sactionals, which make up about 85% of its total sales, are modular couches that can be rearranged dozens of ways to fit virtually any livable space. There are around 200 different cover choices with sactionals, meaning they'll match the color or theme of any room. And best of all, the yarn that goes into these covers is made entirely from recycled plastic water bottles. Buyers are getting eco-friendly, functional furniture that's guaranteed to match their home décor.
Additionally, Lovesac has deployed an omnichannel sales approach that's really paying dividends. During the pandemic, most traditional furniture stores were clobbered by a steep drop-off in foot traffic. Meanwhile, Lovesac shifted almost half of its sales online. Between direct-to-consumer sales, pop-up showrooms, and showroom partnerships with brand-name retailers, Lovesac has created a low overhead sales model that pushed it to recurring profitability two years ahead of Wall Street's schedule.
This furniture stock offers sustainable double-digit growth potential through at least mid-decade, if not well beyond.
