- As we approach 2025, savvy investors should consider these five cheap stocks with massive upside potential.
- Each is trading below Fair Value, making them prime candidates for investors seeking high potential returns at bargain prices.
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As 2025 approaches, investors looking for high-growth opportunities may find incredible value in the following five stocks. Each operates in a promising sector, offers strong growth prospects, and trades significantly below its AI-powered Fair Value according to InvestingPro.
For investors seeking high potential returns, these five stocks offer a perfect blend of value and opportunity.
1. Darling Ingredients
- Current Price: $35.57
- Fair Value Estimate: $54.01 (+51.8% Upside)
- Market Cap: $5.7 Billion
Darling Ingredients (NYSE:DAR) converts organic waste into renewable products, such as green diesel, animal feed, and bioenergy solutions.
The Irving, Texas-based company is uniquely positioned to capitalize on global sustainability trends, including the shift toward renewable energy. Its partnerships with industry leaders and government-backed renewable fuel mandates provide a steady growth pipeline.
With its focus on innovation and waste transformation, Darling continues to stand out in the circular economy.
Source: InvestingPro
DAR stock has a Fair Value of $54.01, as per InvestingPro, pointing to a 51.8% upside potential, reinforcing its appeal as a sustainable growth play. Pro also points out that analysts at UBS and JPMorgan (NYSE:JPM) both rate the stock as a buy.
2. StoneCo
- Current Price: $9.39
- Fair Value Estimate: $16.86 (+79.5% Upside)
- Market Cap: $2.8 Billion
StoneCo (NASDAQ:STNE) is a Brazilian financial technology company specializing in payment processing and financial solutions for small and medium-sized enterprises.
The fintech company’s growth is fueled by Brazil’s increasing adoption of digital payment methods and its expanding customer base in underserved markets. StoneCo has aggressively invested in technology to offer seamless and secure transactions, positioning itself as a market leader.
Additionally, the company’s focus on providing value-added services like credit solutions and business analytics bolsters its long-term outlook.
Source: InvestingPro
With a Fair Value of $16.86, STNE stock presents a 79.5% upside potential from its current price of $9.39, making it a compelling choice in the fintech sector. InvestingPro also mentions that StoneCo has an above-average Financial Health Score thanks to robust profit growth prospects and a cheap valuation.
3. Ziff Davis
- Current Price: $57.72
- Fair Value Estimate: $93.37 (+61.8% Upside)
- Market Cap: $2.5 Billion
Ziff Davis (NASDAQ:ZD) owns a diverse portfolio of digital media properties and subscription-based technology services, catering to industries like healthcare, gaming, and cybersecurity.
The New York-based company’s ability to generate consistent recurring revenue through subscriptions and advertising makes it a resilient and attractive investment. Ziff Davis has also demonstrated expertise in strategic acquisitions, expanding its footprint in high-margin industries.
As digital content consumption continues to rise, Ziff Davis is well-placed to capture market share.
Source: InvestingPro
Trading substantially below its Fair Value of $93.37, ZD stock offers a 61.8% upside, highlighting its undervaluation and growth potential. As per InvestingPro, management has been aggressively buying back shares in recent months.
4. PagSeguro Digital
- Current Price: $7.36
- Fair Value Estimate: $12.82 (+72.3% Upside)
- Market Cap: $2.3 Billion
Similar to StoneCo, PagSeguro Digital (NYSE:PAGS) operates as a payment platform and digital bank, primarily catering to Brazil’s massive unbanked population.
The São Paulo-based company’s strength lies in its ability to combine payment solutions with financial services, such as lending and prepaid card offerings, to drive customer retention and revenue growth.
Furthermore, PagSeguro has also made significant strides in penetrating Brazil’s growing e-commerce market, creating a scalable and profitable business model.
Source: InvestingPro
As a leader in the push for financial inclusion, its Fair Value of $12.82 signals 72.3% upside potential, making it an attractive choice in emerging markets. InvestingPro notes that Ziff Davis is currently trading at low earnings multiples relative to near-term profit growth.
5. ACM Research
- Current Price: $14.10
- Fair Value Estimate: $26.44 (+86.4% Upside)
- Market Cap: $888.7 Million
ACM Research (NASDAQ:ACMR) designs and manufactures advanced cleaning technologies for the semiconductor industry, a critical component in chip production.
The Fremont, California-based company’s innovative solutions, such as its proprietary ultra-cleaning technologies, make it a vital player in the semiconductor supply chain. With global demand for semiconductors continuing to grow, ACM Research is well-positioned to benefit from increased investments in chip manufacturing.
Furthermore, its geographic expansion, particularly in Asia, strengthens its revenue streams. Although based in the U.S., most of the company's business is done in China through its subsidiary, ACM Research (Shanghai).
Source: InvestingPro
With a Fair Value of $26.44, ACMR offers an 86.4% upside potential, underscoring its pivotal role in an increasingly digital world. As per InvestingPro, ACM Research has a solid balance sheet, combined with an upbeat sales growth outlook and an attractive valuation.
Conclusion
The five companies mentioned above operate in industries with significant growth trajectories, from fintech and semiconductors to renewable energy and digital media. Tailwinds such as rising digital adoption, increasing demand for green energy, and global semiconductor needs create favorable conditions for these stocks to outperform.
Furthermore, each is trading well below Fair Value, making them prime candidates for investors seeking high potential returns at bargain prices.
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Disclosure: At the time of writing, I am long on the S&P 500, and the Nasdaq 100 via the SPDR® S&P 500 ETF, and the Invesco QQQ Trust (NASDAQ:QQQ) ETF. I am also long on the Technology Select Sector SPDR ETF (NYSE:XLK).
I regularly rebalance my portfolio of individual stocks and ETFs based on ongoing risk assessment of both the macroeconomic environment and companies' financials.
The views discussed in this article are solely the opinion of the author and should not be taken as investment advice.
Follow Jesse Cohen on X/Twitter @JesseCohenInv for more stock market analysis and insight.