Finding stocks that can make you a millionaire isn't easy, but it is possible. Just look at Super Micro Computer, a recent market-stomper. Just $30,000 invested in it at the start of 2020 would have made you a millionaire by now, and the stock was right under most investors' noses.
So what other stocks have that kind of upside that you should be watching? I've got two that make the cut.
UiPath and dLocal each serve massive markets
Taking a cue from Supermicro, to find stocks that could make you a millionaire you have to pinpoint a company that makes a fantastic product in an industry about to take off. For Supermicro, it was highly customizable server racks that could be used to train AI models.
UiPath (PATH 0.26%) and dLocal (DLO 0.56%) are on my radar as two stocks that could also produce unreal returns. These two serve industries that could be on the verge of major expansion, making them stocks with potentially extreme upsides.
UiPath is a leader in robotic process automation (RPA). RPA allows its users to automate repetitive tasks, which frees them up to do more work that requires original thinking. Now that AI technology is improving, the range of tasks UiPath can automate is also increasing, making now an excellent time to get into the stock before the technology sees massive adoption.
Polaris Market Research estimated that the global RPA market was around $2.66 billion in 2022. However, this is expected to expand substantially in the next decade, reaching a $66 billion market opportunity by 2032. With UiPath's annual recurring revenue of $1.38 billion as of Q3 FY 2024 (ending October 31), it's already a huge player in this space.
As companies look to improve efficiency using AI, RPA will be a natural benefactor. With UiPath's strong foothold, its stock is expected to have explosive performance in the next few years.
dLocal operates in a completely different field. Its products are tailored to emerging market economies, and give big e-commerce companies the tools to operate in countries with different currencies and economic structures.
Cultures and laws have caused many countries to create payment ecosystems different from what most first-world countries use. Creating a new system for each country would be expensive and inefficient, so some companies don't bother selling in these locations. However, with dLocal's toolkit, customers can easily integrate plug-ins that allow their business to operate in locations like India, Indonesia, Egypt, Senegal, and Peru. This product is incredibly popular, and is already used by giants such as Amazon, Shopify, Nike, and Booking Holdings.
With processed volume growing 69% to $4.6 billion in Q3 of FY 2023 (ending September 30), dLocal is rapidly growing. If it can get other commerce giants on board with its product, its growth will be impressive over the next decade.
Both stocks can be purchased for reasonable prices
Another factor Super Micro Computer had going for it was a fairly low valuation. Before its run-up, Supermicro traded at a fairly cheap valuation.
Both dLocal and UiPath also fall into this category, as they are cheaply valued from their respective valuation methods.
Because UiPath isn't profitable, I'll use its price-to-sale (P/S) ratio to value the business.
PATH PS Ratio data by YCharts
Although it used to be cheaper, 12 times sales isn't a bad price for a company growing its revenue at a 24% pace. While the investors who purchased the stock at seven times sales in October got a better deal, it's still at a prime valuation for significant upside.
dLocal is profitable and trades at a cheap 21 times forward earnings. This is an incredibly low price for a company growing revenue at a 47% pace.
While I can't guarantee that UiPath or dLocal will make you a millionaire as quickly as Super Micro Computer did its investors, I am confident these two stocks will outperform the market over the long term. This will accelerate your path to becoming a millionaire, no matter how large or small your account balance is.
