Game-changing innovations and massive new markets can create lucrative opportunities for investors. Read on to learn more about two stocks that could deliver life-altering gains to their shareholders in the coming years.
1. Archer Aviation
When people talk about electric vehicles (EVs), they typically think of Tesla's sleek cars or Ford Motor's rugged F-150 Lightning. But soon, EVs will take to the air. Archer Aviation (ACHR 1.00%) wants to spearhead this next evolution in travel with its trailblazing battery-powered aircraft.
Archer's all-electric vertical take-off and landing (eVTOL) vehicles are technological marvels. Its award-winning Midnight aircraft is designed to fly high above congested roadways to slash commute times and usher in a formerly impossible level of urban mobility. With zero operating emissions, Midnight could also help to bring about a cleaner and safer world.
Archer Aviation's Midnight aircraft. Image source: Archer Aviation.
Travel industry giants are jumping at the chance to partner with Archer. United Airlines, Boeing, and multinational automaker Stellantis are notable investors in the eVTOL pioneer. Stellantis is also working with Archer to ramp up its manufacturing operations, and United Airlines has agreed to buy up to $1.5 billion worth of the EV designer's forthcoming aircraft.
Archer's technology has also caught the attention of the Defense Department. It has a contract with the U.S. Air Force worth up to $142 million to test its eVTOL designs for use across a range of missions.
International markets also beckon. Archer struck a deal with travel conglomerate InterGlobe Enterprises in November to build an all-electric air taxi service across India by 2026. Archer also reached an agreement with the Abu Dhabi Investment Office in October to launch a similar air mobility network across the United Arab Emirates.
Archer expects to begin commercial operations by 2025. That could mark the beginning of a new urban air mobility market that's projected to reach $1 trillion by 2040, according to investment bank Morgan Stanley. Today, you can purchase shares of this future industry leader while its market capitalization stands at only $1.5 billion.
2. DraftKings
Fast-growing industries are fertile ground for fortune-building investments. Sports betting is one such market, and DraftKings (DKNG 4.96%) is an emerging industry leader.
The legalization of sports gambling is gaining steam in the U.S., where it's helping state governments bolster their budgets by increasing their tax revenue. This trend is a boon for DraftKings.
The company's sportsbooks are live in 26 states. High-potential markets like California and Texas beckon, as do international markets like Canada, where DraftKings is already making inroads. All told, Grand View Research sees the global sports betting market topping $180 billion by the end of the decade.
DraftKings excels at entering newly legalized markets and gaining customers quickly. The company saw its monthly unique payers jump 40% year over year to 2.3 million in the third quarter. Combined with a 14% rise in average revenue per payer, this helped to boost DraftKings' sales by 57% to $790 million.
Importantly, the sports betting front-runner is making progress toward sustained profitability as it scales its operations. Management sees DraftKings' adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) improving to approximately $400 million in fiscal 2024, compared to a loss of $105 million in fiscal 2023.
Looking further ahead, DraftKings thinks it can grow its adjusted EBITDA to over $2 billion by 2028 in just its existing markets. And if the remaining U.S. states legalize sports betting, an additional $6 billion in annual adjusted EBITDA could be possible.
With its earnings set to soar, buying DraftKings stock seems like an intelligent wager to place today.
