As the S&P 500 hovers near its all-time highs, it might not seem like the best time to load up on new stocks -- since Warren Buffett famously warned us to be "fearful when others are greedy." But a closer look reveals that many stocks that aren't components of that elite index still trade at discount valuations.
Let's examine three of those stocks that still look dirt cheap relative to their growth potential -- Plug Power (PLUG 3.33%), Opendoor (OPEN 5.59%), and SoFi (SOFI 1.98%) -- and see why they might just turn a modest $1,000 investment into a small fortune within a few years.
Image source: Getty Images.
1, Plug Power
Plug Power, a major hydrogen charging and storage company, has deployed over 72,000 fuel cell systems and 275 fueling stations across the world. Its fuel cells are mainly used in forklifts, and its top customers include Amazon and Walmart.
Last year, Plug Power's revenue plummeted 24% as its net loss widened. The macro headwinds curbed the market's appetite for its new hydrogen charging projects, and it lapped two major acquisitions that expanded its cryogenic systems business in 2022 and 2023.
But from 2024 to 2027, analysts expect Plug's revenue to increase at a CAGR of 30% as the hydrogen market heats up again in a warmer macro environment. It's also expected to narrow its net losses as it executes its "Project Quantum Leap" cost-cutting plan, while its new $1.66 billion loan guarantee from the U.S. Department of Energy (DOE) (to build six new green hydrogen manufacturing plants) should keep it solvent as it carefully expands again.
Plug Power still has a lot to prove, but its stock looks cheap at less than 1 times this year's sales. Any positive news could scare away its short sellers (28% of its float as of July 31) and drive its stock higher. That might be why its insiders were still net buyers over the past 12 months.
2. Opendoor Technologies
Opendoor is the largest "instant buyer" (iBuyer) of homes in America. It uses its artificial intelligence (AI) algorithms to make instant cash offers on homes, fixes them up, and relists them on its own marketplace. That business model flourished when interest rates were low and new home sales accelerated after the pandemic, but it fizzled out when interest rates spiked.
That's why Opendoor's revenue plunged 55% in 2023 and fell another 26% in 2024. Its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) also stayed red over the past three years. For 2025, analysts expect its revenue to decline another 21%.
That situation seems grim, but Opendoor actually bought more homes again in 2024 as the Federal Reserve cut its benchmark rates three times. Its adjusted EBITDA margin also improved as it trimmed its workforce while reducing its resale transaction costs and commissions.
In addition, it's partnering with more home builders and real estate platforms to reach more sellers, upgrading its AI algorithms to improve the accuracy of its offers, and directly matching buyers to sellers through its new Opendoor Exclusives platform to avoid buying and repairing the properties on its own. All of those catalysts, along with further interest rate cuts, could boost its revenue again.
That's why analysts expect its revenue to grow at a CAGR of 12% from 2025 to 2027, and for its adjusted EBITDA to turn positive by the final year. That's a promising growth trajectory for a stock that trades at less than 1 times this year's sales. Nearly 24% of its shares were still being shorted at the end of July, but its insiders were also net buyers of the stock over the past 12 months.
3. SoFi Technologies
SoFi runs a one-stop digital shop for loans, insurance policies, estate planning services, credit cards, banking services, and stock trading tools. By bundling those services together and targeting a younger generation of digitally native users, it aims to disrupt traditional banks.
From 2021 to 2024, SoFi's year-end members quadrupled from 2.5 million to 10.1 million, its number of products in use surged nearly eightfold from 1.9 million to 14.7 million, and its annual revenue more than doubled from $1.01 billion to $2.61 billion. Its fintech subsidiary, Galileo, which provides its own payment and card issuing services, hosts nearly 160 million accounts.
SoFi's growth rates are impressive, but it was affected by rising interest rates, which chilled the market's demand for new loans, as well as a temporary freeze on student loan payments from 2020 to 2023. Its transition into a digital bank also compressed its margins with higher compliance costs.
But looking ahead, those headwinds will dissipate as interest rates decline and student loan payments resume. That's why analysts expect its revenue and adjusted EBITDA to increase at a CAGR of 25% and 37%, respectively, from 2024 to 2027.
SoFi's stock isn't as heavily shorted as Plug Power and Opendoor, and its insiders were still net sellers over the past 12 months. However, I think this oft-overlook fintech stock still looks like a bargain at 17 times next year's adjusted EBITDA.
