3 Stocks That Could Turn $10,000 Into $50,000 by 2025

Every investor wants to get multibagger returns from their investments.

Not only can a stock that jumps 500% or 1,000% make you rich, but one big winner can also make up for several losers in your portfolio. Generally, a good candidate to be a multibagger stock has a relatively low market cap, trades at a cheap valuation, and is growing quickly.

If you've got $10,000 to invest, keep reading to see three stocks that could turn that investment into $50,000 in just a few years.

1. An online auto parts disruptor

CarParts.com (PRTS -1.41%) stock surged during the pandemic. The online auto parts retailer benefited from a spike in demand in the e-commerce channel as well as increased interest in auto parts as DIY car owners took advantage of the extra free time to work on their cars.

Since that boom, CarParts.com stock has pulled back, falling more than 70% from its peak in early 2021.

However, CarParts.com's performance continues to be solid. In the second quarter, revenue increased 12% to $176.2 million, outpacing a number of e-commerce companies as the sector faces difficult comparisons with the quarter a year ago. Its net income nearly doubled to $0.07 per share, and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) was flat at $8.3 million. At a market cap of just $300 million, that means the company trades at about 10 times run-rate EBITDA, or 20 times earnings, making it well priced for a growth stock.

Though its growth rate has slowed down, CarParts.com is still targeting 20% to 25% revenue over the long term with adjusted EBITDA margins of 8% to 10%. If the company can hit those targets, the stock could easily jump 400% between now and 2025 as its revenue would essentially double in that time, giving it around $140 million in adjusted EBITDA.

Better yet, the company is currently rolling out a "do-it-for-me" service that connects customers with auto shops, offering transparent pricing and a seamless customer experience. That new service, which the company hopes to eventually pair with a mobile mechanic who can come to your house and work on your car, could ignite the company's growth.

2. Riding the digital optimization wave

Software-as-a-service (SaaS) stocks have gotten hit hard in the market sell-off, and Amplitude (AMPL -5.22%) is no exception. The stock fell by roughly 60% in a session earlier this year when it trimmed its 2022 guidance.

However, the company is still posting strong growth numbers, and it's the leader in digital optimization software, an emerging software category that enables businesses to optimize their digital products through data. Digital optimization is what follows digital transformation.

Amplitude's tools helped Peloton Interactive realize that social interaction was key to its growth, and guide Burger King's "Whopper Detour" campaign, which offered a Whopper for a penny to customers near a McDonald's when they downloaded the app.

In its second quarter, Amplitude's revenue jumped 48% to $58.1 million with current remaining performance obligations up 46% to $170.2 million, showing its backlog remains strong. The company is unprofitable under generally accepted accounting principles (GAAP), but it posted a free cash flow profit of $8.3 million in the second quarter as it benefited from a $10 million inflow on an early renewal expansion that it expected for the third quarter.

Amplitude's market cap is currently $1.7 billion, giving it a price-to-sales ratio of 7.3 based on this year's expected revenue of $232 million to $236 million, a reasonable valuation for a company that just grew revenue by nearly 50%. Amplitude is targeting a $37 billion addressable market, and if the company can maintain its growth rate and take steps toward profitability, it looks well positioned to be a multibagger over the next few years.

3. A new approach to lending

Upstart Holdings (UPST -7.89%) is a tech company that uses artificial intelligence to match borrowers with lenders, giving borrowers higher approval rates and lenders lower loan losses.

That disruptive approach delivered monster growth for both the business and the stock in 2021 as revenue grew by triple digits and the stock soared from its $20 December 2020 initial public offering price to over $400 at one point. However, since then, Upstart stock has given up nearly all of those gains as revenue growth has ground to a halt amid nervousness over rising interest rates and as Upstart's platform has yet to go through a full credit cycle.

There's a lot of uncertainty at play for Upstart as its business model is unproven during a recession, and the tech company went from posting triple-digit revenue growth to just 18% in the most recent quarter.

However, Upstart has demonstrated its ability to deliver strong profits in a healthy economy as it finished 2021 with GAAP net income of $135 million on revenue of $849 million. 

At this point, the stock looks cheap enough to make it worth the risk, and a good bet if you're looking for stocks to give you 5x returns by 2025. The company's market cap is now just $1.7 billion, or just 12.6 times last year's GAAP net income. Though Upstart is risky, the Federal Reserve projects that interest rates will fall by 2024. That helps set up Upstart stock for comeback by 2025.