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Gearing Up for the Next Ten-Bagger: Where to Look

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The stock market is the only store where things go on sale and customers run for the hills.

While a bear market is certainly painful, there is a beneficial, yet overlooked aspect during a period of falling stocks: it creates incredible future profit opportunities. And we want to make sure we’re ready to pull the trigger when the time comes.

Make no mistake – this bear market is laying the groundwork for investors to make boatloads of money in the coming years. Many investors missed the chance to multiply their money several times over during the trough in previous market cycles. But the market is once again setting up for the opportunity of a lifetime.

The Wonderful Tenbagger

In stock market terms, a “tenbagger” is a stock that has risen ten times in value since the original purchase. If you’ve ever had the pleasure of snagging a tenbagger, you know how appealing it can be.

The best time to initiate a bullish position with tenbagger potential is after a vicious bear market when stock prices are depressed. The undervaluation created by a decline in demand and extremely negative consumer sentiment helps to mark a shift for the bulls. While the move can be subtle at first, prices can swiftly reverse course and notch huge gains in a very short period of time.

After the March 2020 bottom, Titan International (TWI - Free Report) – a leading, global manufacturer of wheels, tires, and undercarriage products – soared from $1/share to over $11/share over the course of a year.

Titan International, Inc. Price and EPS Surprise

Titan International, Inc. Price and EPS Surprise

By the way, TWI has continued its bullish run and is now trading over $18/share. TWI is currently a Zacks Rank #1 (Strong Buy) stock.

What about weak markets? Can we notch a tenbagger when most stocks are falling? The answer is unequivocally yes. Let’s take a look at an example of a stock that has done just that over the last year.

The materials sector became undervalued, and Alpha Metallurgical Resources (AMR - Free Report) – a mining company that supplies products to the steel industry – was primed for a sustained bull run. AMR soared from $13/share in May of 2021 to roughly $147 today.

Alpha Metallurgical Resources, Inc. Price and EPS Surprise

Alpha Metallurgical Resources, Inc. Price and EPS Surprise

AMR is also a Zacks Rank #1 (Strong Buy) stock.

Where to Look Now

Just like the materials sector was hated and undervalued last year, technology has quickly become the most oversold sector this year. While the selling pressure may still have more legs in the short-term, the ensuing panic will create a golden opportunity for the astute investor.

A good place to start is to pinpoint relatively smaller companies that have the ability to grow their revenues and earnings at an extremely fast pace. Target companies that are heavily involved in new technologies which will drive the future such as artificial intelligence, robotics, and machine learning.

The disruptive innovation that these technologies will produce will create new markets and help drive stock prices higher. So make sure you’ve got plenty of dry powder and you’re ready to pull the trigger when the time comes. Here’s to your next ten bagger!

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

Alpha Metallurgical Resources, Inc. (AMR) - free report >>

Titan International, Inc. (TWI) - free report >>

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