Companies at the forefront of medical or technological innovation are often rewarded for their efforts, both in terms of financial results and in terms of stock market performance. This is why many investors are actively looking for such companies: getting to the first floor can lead to crushing profits in the long run.
But even if such a company has already enriched quite a few investors, it might be worth buying its stock if there is enough growth left in its engine. With that in mind, let’s turn our attention to two revolutionary stocks that turned $ 200,000 into over $ 1,000,000 (that’s over 500% return): Moderna (NASDAQ: MRNA) as well as Facebook (NASDAQ: FB)… This is why both of these companies could still be given a long runway to grow.
1. Moderna: 900% return over the last 2.5 years.
Moderna went public in December 2018 and was a relatively unknown company until last year. Biotechnology has made a name for itself through efforts to develop a vaccine against COVID-19, mRNA-1273. But even though the market welcomed Moderna’s work and made its stock skyrocket, I remained quite skeptical. Recently I was forced to reconsider my position.
Moderna specializes in the development of messenger RNA (mRNA) vaccines. Unlike most conventional vaccines, mRNA variant vaccines do not confer immunity by injecting a harmless form of the virus into patients’ bodies. Instead, mRNA vaccines work by delivering genetic instructions to the body that help the immune system respond appropriately as soon as it encounters a real virus.
This technology is not new, but no such product received an Emergency Use Authorization (EUA) from the US Food and Drug Administration (FDA) until December 2020. Once the regulatory agency gave the green light to COVID-19 vaccines developed by Moderna and Pfizer / BioNTech (which is also an mRNA) vaccine, this technology has reached a new level of acceptance.
On average, analysts expect Moderna to generate $ 17.42 billion in revenue this year, which is not bad for a company that had no products on the market just a few months ago. This windfall will help biotechnology fund more than a dozen clinical programs, most of which are mRNA vaccines for infectious (and many serious) diseases.
According to Moderna, of the more than 80 new viruses discovered in the past 40 years, only 4% have vaccines approved in the United States. In other words, there is a large and unmet need in this market. With its mRNA platform and the money it will receive from the sale of mRNA-1273, the company is well positioned to succeed in its efforts to develop and market a variety of vaccines.
In my opinion, the post-coronavirus master plan has multi-billion dollar potential and should help steer the company’s growth trajectory in the right direction, making it a great biotech stock to consider today.
2. Facebook: 740% return over the past nine years.
Facebook has revolutionized how we communicate in many ways. And while the company’s eponymous website is still a core part of its business, the tech giant has expanded its suite of social media platforms. Facebook acquired Instagram and WhatsApp, and added Facebook Messenger to its arsenal. In total, as of March 31, these services had 3.45 billion monthly active people.
Naturally, Facebook’s pioneering efforts in social media have not gone unnoticed, but the company has had its share of the struggle as well. Facebook has been implicated in data breach scandals and has recently been denounced by many for its stance on political ads and hate speech on its platform. In addition, Facebook and other big names in the tech industry have come under scrutiny from lawmakers due to alleged monopolistic practices.
These headwinds may scare off some investors, but as a shareholder I am not going to jump off this ship anytime soon. One of the main reasons for this is that Facebook is too attractive for advertisers. After all, nearly half of the world’s population visits one of the company’s platforms at least once a month. Facebook’s user base is likely to continue to grow, and that can only mean good news for ad revenue, which accounts for the vast majority of its revenue.
In the first quarter, Facebook’s revenue was $ 26.2 billion, up 48% over the same period last year. The company’s advertising revenue was $ 25.4 billion, up 46% from a year earlier. On average, analysts predict the company’s revenue growth of 21.5% per year over the next five years. Note that Facebook still generates most of its sales through the website of the same name and Instagram.
The company has yet to fully monetize WhatsApp and Messenger, giving the tech giant another long-term opportunity. In short, for those who haven’t bought Facebook stock yet, it’s not too late to do so.
This article represents the opinion of an author who may disagree with the “official” position of the Motley Fool premium advisory service. We are colorful! Bidding on an investment thesis – even our own – helps us all to be critical about investing and make decisions that help us become smarter, happier, and richer.