For big gains, it’s often beneficial to own growth stocks. These are securities of companies that are typically younger and less established than so-called “value stocks” but are expanding rapidly to take market share in their respective sector. These companies might not always be profitable, but they have a big opportunity to grow at an exponential rate. This can lead to a rapid rise in the share price and big gains for stockholders. In more mature, established companies, growth can be harder to come by. This is why many companies whose growth has slowed offer dividend payments to their shareholders and use excess cash to buy back their own stock. While that’s fine, investors looking for explosive growth in their portfolio should target stocks of companies that are just gearing up or are expanding at a fast clip. Here are three promising stocks to buy with 50% upside potential. Cava (CAVA) Cava Group (NYSE: ) is a fairly new restaurant chain specializing in Mediterranean cuisine. Founded in 2011, the company went public in June 2023. Since then, its stock has risen 43%, including a 12% pop after the company posted better-than-expected financial results for the final quarter of last year. Cava surprised investors and analysts last summer with its first earnings report as a public company that showed it was already profitable, a rare feat for most concerns. The restaurant chain, which now has about 300 locations, has huge growth potential and room for future expansion. CAVA Cava just reported fourth-quarter 2023 earnings per share of 2 cents, which was double the 1 cent expected among analysts. Revenue in Q4 totaled $177.2 million, beating forecasts that had called for sales of $175.2 million. The company’s sales grew 52.5% year-over-year. For all of last year, Cava reported a profit of 21 cents a share and sales of $728.7 million. The company opened 72 new restaurant locations in 2023 and plans to open 52 more this year. The company also forecast a 2024 profit margin of 22.7% to 23.3%. CAVA stock has gained 33% so far in 2024, with more upside potential. Deckers Outdoor (DECK) Deckers Outdoor (NYSE: ) is taking the footwear sector by storm. The company behind popular brands such as Hoka running shoes, Teva sandals, and Ugg casual footwear has reported successive quarters of record sales and profits. In early February, the company reported Q4 2023 financial results that crushed Wall Street estimates. Deckers Outdoor announced EPS of $15.11, beating consensus estimates of $11.40. Revenue totaled $1.56 billion, which topped forecasts of $1.44 billion. Both the earnings and revenue were record amounts for the company. DECK Not surprisingly, DECK stock has responded to the strong earnings. In the last 12 months, the company’s share price has more than doubled (up 112%), including a nearly 30% gain so far this year. Through five years, the stock is up almost 500%. Like Cava, Deckers has a long runway ahead of it as it continues to take market share from competitors such as Nike (NYSE: ). To that end, Deckers Outdoor just announced a new CEO, Stefano Caroti, who is currently the company’s Chief Commercial Officer. Caroti has worked at Deckers for a decade and previously was an executive at Nike. NKE DraftKings (DKNG) DraftKings (NASDAQ: ) is in aggressive growth mode as it seeks to gain a greater share of the market for online betting and sports gambling. The company recently launched its Sportsbook betting product in Maine and Vermont, bringing it to a total of 24 U.S. states that now allow its mobile sports betting, as well as Canada, where gambling is legal nationwide. The company also recently announced that it is acquiring lottery app DKNG Jackpocket for $750 million as it seeks to appeal to a broader segment of the gambling market. The growth strategy is working as DraftKings has become the leader in online gambling within America. At last count, DraftKings controlled 31% of the U.S. market. In its recent earnings print, DraftKings said that it averaged 3.5 million monthly unique payers in Q4 2023, a 37% increase from the same period of 2022. The average revenue per payer rose 6% from the previous year. The rapid growth and market-leading position have propelled DKNG stock higher. Over the last 12 months, the company’s share price has increased 125%, including a 26% upsurge this year. On the date of publication, Joel Baglole held a long position in DECK. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines .
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