There's no way to know for sure which stocks will be the multibaggers of tomorrow. However, there are some companies that have excellent leadership, strong capitalization, and massive addressable market opportunities. Here are two in particular that could be long-term home runs for investors who get in during the 2022 bear market.
The next Berkshire Hathaway?
Boston Omaha (BOC 0.70%) is an up-and-coming conglomerate that is often compared with an earlier-stage Berkshire Hathaway. And it's easy to see why. Boston Omaha's co-CEOs are following Warren Buffett's Berkshire playbook pretty closely -- they invest in businesses with low ongoing capital requirements and excellent cash flow, and they aren't afraid to invest in noncontrolling stakes when they see excellent opportunities.
NYSE: BOC
Key Data Points
The company has four main subsidiaries. Its three operating businesses are billboards, insurance, and broadband. And the newly created Boston Omaha Asset Management (BOAM) business is where everything else is housed, including large stakes in publicly traded companies Dream Finders Homes and Sky Harbour. The most exciting part of the BOAM business is just getting started, as the company sees massive opportunities in built-for-rent housing and fiber infrastructure and it plans to raise outside capital to pursue them.
To be perfectly clear, I'm not necessarily saying that Boston Omaha will grow into a Berkshire-sized conglomerate. But there's certainly potential for the business to multiply in size several times over, and management has shown its ability to allocate capital wisely and think outside the box when it comes to creating value.
A massive disruptor with an even larger opportunity ahead of it
It may sound odd that I'm referring to Airbnb (ABNB 1.88%) as a future all-star. After all, the travel disruptor had about $16 billion worth of bookings on its platform in the third quarter alone and has completely redefined the way millions of Americans travel (and monetize their homes).
Hear me out. Although Airbnb is a massive company, it still has captured only a small percentage of its potential revenue. The company estimates the addressable market for its platform -- including short and long-term rentals, as well as experiences -- to be about $3.4 trillion in annual booking volume.
NASDAQ: ABNB
Key Data Points
Management has done a great job of convincing new hosts to list on the platform and of finding new ways to increase its reach. For example, the company just announced that it was creating a way for apartment renters in certain buildings to list their homes on Airbnb, which has historically been exclusively for owners. While not all apartments permit short-term subletting, there are over 21 million apartments in the United States alone, so it's fair to say that even capturing a small percentage could be a big win. With the stock down by about 55% from its 2021 peak, now could be a great time to consider adding it to your portfolio.
Buy for the long term
Just like most other stocks that have massive addressable market opportunities, it's wise to expect significant volatility over short periods with both of these companies. I have no idea what Boston Omaha or Airbnb stock will do over the next few weeks or months, and neither does anyone else. However, these are both well-run businesses that have demonstrated their capital allocation abilities already but that have large opportunities that could take decades to play out. And if their management teams can execute on their respective visions, they could be home runs for patient investors.
