2020 and 2021 have been some of the most active years for IPOs in history. In a recent episode of “The Rank” on Fool Live, recprded Sept. 27, Fool.com contributors Matt Frankel, CFP, Jon Quast, and Danny Vena took a closer look at some of their favorite recently public companies, and there were two in particular they mentioned as having strong 10X potential.
Matt Frankel: Real quick, which of these seven stocks do you think has the highest probability of producing 10X returns, let’s say over the next decade. Highest profitability. Not necessarily which one has the most growth potential, which one is most likely to be worth 10 times its current price in a decade? I will start with Danny.
Danny Vena: This is a tough one for me because I really like FIGS and definitely one that I could see growing from here. But now that I’ve got Latch (NASDAQ:LTCH) on my radar and because of the way the company makes money, I would say Latch is probably the one that gets a 10X fastest from here.
Frankel: Great. Over to Jon.
Jon Quast: Yeah, I concur. Latch is my top 10X opportunity out of this list.
Frankel: Well, just because I don’t want to give the same answer three times, I would say Latch is the one that has the most potential. In other words, I can see Latch being 100X in 15, 20 years if everything goes well. I’d say most likely to 10X, I’d say Airbnb (NASDAQ:ABNB) is actually very underrated in terms of its 10X potential. It’s a pretty big company right now. That would put it at, I want to say $700 or $800 billion if it were to 10X in 10 years, which I think is entirely possible if it really keeps expanding its reach in the short term rental market, the long term rental market, and figures out how to create a travel ecosystem of other experiences. I think a 10X is more likely than you might think.
A lot of people didn’t think Amazon was going to 10X when it hit $200 billion, but there it is. Don’t think just because the companies are already pretty big, it doesn’t have that potential. I think Airbnb is probably the most underrated.
Vena: It’s $109 billion right now.
Frankel: It’s $109 billion right now? So that will put a little over a trillion dollars. Which I don’t think that’s a gigantic stretch.
Vena: Rarefied company.
Frankel: Yeah, that’s true. But it’s a non-zero profitability and I think a bigger one than people are thinking. I think it’s, by far, the most market dominant company on our list.
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