3 stocks that could double again in the fourth quarter

There are 77 publicly traded companies in the U.S. with market capitalizations above $1 billion, and their value has more than doubled in the first nine months of this year. Most of them won’t double again, but I want to highlight three that I think could continue to rise through the last three months of 2024.

Nvidia (NVDA 1.19%), Sweet green (SG -2.04%)AND Sea limited liability company (S.E -3.19%) could potentially double again in the fourth quarter. Let’s take a closer look at these high-flying names that may not have plans to land anytime soon.

1. Nvidia: 145% increase

It may seem cheeky to start this list with the third most valuable company in the country by market capitalization. This suggests that Nvidia will become the first company to exceed a market capitalization of $4 trillion, $5 trillion and possibly $6 trillion in the next three months. However, none of the market giants is developing as fast as Nvidia. Revenues have more than doubled in each of the last five quarters, and in three of those reports, that number has more than tripled.

Nvidia has come a long way since the days when it was simply the leader in the GPU market. This has become an obvious play in artificial intelligence. It was already a standout with hardware necessary for everything from virtual reality to autonomous driving. It’s a leading player in AI chips, and business is booming as companies look to gain a competitive advantage by leading the way in AI.

However, the top line won’t grow at triple-digit rates forever. Nvidia’s own guidance calls for a 79% revenue increase in the current quarter, which the company should report in late November. Wall Street professionals then expect a slowdown of up to 42% in the next fiscal year.

Nvidia isn’t cheap either. It is worth 43 times expected earnings for this financial year and 30 times its target for next year. However, with Nvidia consistently beating expectations and analysts trying to raise their forecasts, the stock is likely cheaper than today’s forward-looking models suggest.

Looking just at the fiscal third quarter, which will be announced next month, we see that analyst earnings estimates have increased from $3.39 to $4.02 per share in just the last three months. A lot has happened during this time. A lot can happen in the next three months.

All this favors AI chips and the construction of data centers. A lot of money will have to be spent to generate next-generation computing power, and Nvidia is at the helm. Since Nvidia’s board authorized $50 billion in stock buybacks last summer, it seems like a pretty good authority believes the stock isn’t expensive at all.

2. Sweetgreen: up 214%

Let’s move on from AI chips to Green Goddess Ranch Potato Chips. Sweetgreen operates a growing chain of fast casual restaurants serving the highest quality salads. It sounds simple, but Sweetgreen was a better product than Nvidia this year. It more than tripled in the first nine months of the year.

Sweetgreen is thriving after the initial pandemic crisis that hit most restaurants. It has recorded growth exceeding 20% ​​for 13 consecutive quarters. Rapid expansion and positive results combine to deliver solid earnings growth. Financial results are improving, but actual profitability will still take several years.

Sweetgreen’s growth this year is largely a result of its starting line. Sweetgreen went public at $28 three years ago, but fell to below 15 levels late last year. Despite more than tripling this year, the stock is trading just 25% above its IPO price. The future is bright, and the main catalyst right now is companies calling employees back to the office. Sweetgreen is a popular lunch option among health-conscious workers, and the chain even has a program under which it can set up special facilities in large office buildings to enable mass lunchtime deliveries.

3. Sea Limited: 133% increase

With a 133% gain this year, Sea Limited is a laggard. Sea Limited is a player in the e-commerce, online gaming and fintech industries. The Singapore-based company is benefiting from the recent surge in Asian share prices, but it is a global player that is growing on its own merits.

In the most recent quarter, revenues grew by at least 20% in all three segments. Sea Limited has been struggling with a red ink problem for a long time, but it finally became profitable last year. Analysts expect earnings per share to more than triple this year and nearly triple again in 2025. Sea Limited is trading at 47 times next year’s projected earnings. It may not seem like a bargain, but the stock would need to nearly quadruple to return to the all-time highs it hit three years ago. It is also trading at a reasonable revenue multiple of less than 4. Momentum is currently strong and the ceiling is high.

Rick Munarriz has no position in any of the companies mentioned. The Motley Fool has positions in and recommends Nvidia and Sea Limited. The Motley Fool recommends Sweetgreen. The Motley Fool has a disclosure policy.