If you catch a company as it's revving up for growth and hang on for the long term, you could take some major steps along the path to wealth. Now is a good time to think about such a strategy.
We're heading toward a bull market, an environment known to be supportive of growth stocks. And many growth stocks today are trading at interesting valuations, offering you a buying opportunity.
Right now, if you have $10,000 to invest in some promising growth stocks, such as ones I'll talk about below, you could make a fortune over the next 10 years. That's because each of these players is facing a turning point, and one that could increase earnings and eventually the share prices, too.
Wall Street expects these particular stocks to climb anywhere from 22% -- in the case of Amazon (AMZN 3.43%) -- to about 90% -- in the case of Chewy (CHWY 2.99%) -- in the coming 12 months. But I don't think these companies will stop there, and that's why they're worth holding for the long term.
You could invest your money across all four of the following players, which will lower your risk and allow you to benefit from more than one exciting story. Let's take a closer look at each.
1. CRISPR Therapeutics
CRISPR Therapeutics (CRSP 0.34%) may soon reach a huge milestone: the commercialization of its first product. The company expects a regulatory decision in December on exa-cel for sickle cell disease and a decision in March on exa-cel for beta thalassemia.
Today, treatment options for those blood disorders are limited, so exa-cel, designed as a curative treatment, could bring in blockbuster revenue. And that revenue could start rolling in in the very near future.
Meanwhile, CRISPR also is approaching the finish line with a second candidate, this one in immuno-oncology. It's involved in a phase 2 trial that could support a regulatory submission.
These potential sources of revenue in the next few years could significantly boost CRISPR, which has been trading a lot lower than a few years ago -- and back then, we had much less visibility about the future.
2. Moderna
Moderna's (MRNA 1.69%) key moment may be its transition to a multiproduct company. Right now, it sells a blockbuster coronavirus vaccine, but the ambitious biotech predicts it may release as many as 15 products over the coming five years. And one of those products -- an investigational vaccine for respiratory syncytial virus (RSV) -- could win regulatory approval and launch next year.
All of this may translate into enormous revenue for Moderna. The company predicts as much as $30 billion, which far surpasses its coronavirus vaccine peak revenue of about $18 billion. And at the same time, these potential products would allow Moderna to expand into various treatment areas.
Right now, Moderna trades for only 8x forward earnings estimates, but this doesn't take into account the long-term revenue opportunity. So the biotech looks dirt cheap at these levels.
3. Amazon
Amazon is starting to benefit from recent efforts to improve its cost structure. The company made these moves to counter higher inflation and other economic headwinds. But even in better times, these improvements to efficiency should work to Amazon's advantage, boosting revenue growth.
For example, the company shifted its fulfillment network from a national one to a regional one, a move that should make package delivery faster and cheaper. This lowers costs for Amazon and increases the chances customers will keep ordering,
Amazon's leadership in two high-growth areas -- e-commerce and cloud computing -- also should help it advance in the coming years. And the company's use of artificial intelligence (AI) throughout the business represents another engine for growth.
All of this means Amazon could be heading for a whole new chapter of earnings growth, and that may lead the shares higher over time, too.
4. Chewy
If you're a pet parent, you may know about Chewy. The e-commerce company sells everything from pet food to pet treats and medicine. And Chewy makes it easy for customers to keep coming back through its Autoship option, which automatically reorders and ships your favorite products to you.
Chewy recently reached profitability, and even in today's tough market has managed to grow. In the most recent quarter, sales climbed in the double digits. Autoship purchases represent about 75% of sales, a great sign because it shows customers' loyalty to the company.
The catalyst ahead is Chewy's expansion into Canada. It should happen this year, and the company expects the Canadian market to offer market share and profit prospects similar to those of the U.S. So this could be a big moment for Chewy -- and investors who get in early on the stock.
