In a culture driven by immediacy, it can feel a little weird to think in terms of decades. And yet, for growth stock investors, that time horizon is often where the opportunity lies.
Several exciting start-ups today live in that decades-long perspective. They're not safe, nor are they always dividend-paying, and they often face execution and regulatory risks that could derail their ambitions. But several have cleared enough milestones or raised enough capital to warrant consideration, especially if you're looking to beat the market over the long term.
On that note, if you can tolerate volatility, the following three stocks are worth watching.
Image source: Joby Aviation.
1. Oklo
Oklo (OKLO 3.43%) is a nuclear start-up that's designing compact, fast neutron reactors. These small reactors are meant to sit next to data centers or other remote sites with relatively little disruption, and they're expected to take less time to build than traditional nuclear power plants.
Considering that it has already partnered with big names in the data center space, such as Equinix (EQIX +0.31%) and Vertiv (VRT +0.70%) the company looks well-positioned to capitalize on that promise.
NYSE: OKLO
Key Data Points
Oklo's decade growth story rests on two forces. The first is rising electricity needs stemming from artificial intelligence (AI). The second is a coterminous demand for clean power. Both are answered in its Aurora powerhouse design, a reactor that's intended to run for years between refuelings.
The company is still pre-revenue, and it lacks appropriate licensing from the Nuclear Regulatory Commission (NRC) to commercialize its Aurora design. Its currently making progress through the NRC's regulatory process, but the lack of commercial revenue means Oklo will have to manage capital carefully until it can generate sales.
2. Joby Aviation
Joby Aviation (JOBY 2.05%) is trying to turn an idea from The Jetsons into an everyday reality: flying cars. Or, more precisely, flying taxis. Indeed, Joby wants to become the "Uber Technologies of the air" with an electric vertical takeoff and landing (eVTOL) aircraft. These aircraft will complete short hauls in the air over traffic instead of through it.
The long-term growth pitch for Joby is that it will tap into a new market of urban mobility that could be worth $1 trillion by 2040, according to Morgan Stanley research. The biggest hurdle, however, is proving to the Federal Aviation Administration (FAA) that its craft is safe and reliable for paying passengers.
NYSE: JOBY
Key Data Points
Like Oklo, Joby isn't generating meaningful commercial revenue yet. Not only that, but Joby is also designing an aircraft for an eVTOL market that doesn't yet exist. It needs to build infrastructure -- think vertiports and charging stations -- before it can scale its craft significantly.
3. MP Materials
MP Materials (MP 2.15%) is a rare-earth metal miner that owns and operates the Mountain Pass mine in California, one of the only scalable rare-earth metal mines and processing sites in the U.S.
The company is at the forefront of a U.S. effort to rebuild a domestic supply of rare-earth metals. Its part in this larger strategy is to produce high-performance magnets, from ore to finished product.
These magnets are critical for everything in tech, from smartphones to advanced defense systems, which is why both Apple and the U.S. government have signed on as a strategic partner and investor in MP Materials respectively.
These partnerships and tailwinds are a big reason why MP looks durable over the next decade. On top of that, it has also formed a joint venture with the Saudi Arabian Mining Company to help build a refining hub in the Kingdom. This could further diversify rare-earth metal supply away from China, which currently controls a bulk of the world's rare-earth metal market.
NYSE: MP
Key Data Points
Unlike Oklo and Joby, MP is generating revenue. At the same time, it's posting losses and needs to expand its magnet factory to keep up with demand. Heavy spending will likely pressure its bottom line, and any delays in building its second magnet factory (10X Facility) could create market turbulence in the short term.
That expected volatility is why MP, along with Oklo and Joby, will likely fit the strategies of aggressive investors. These are companies that still have something to prove, yet have laid the groundwork for businesses that could scale meaningfully over the next decade.
