If you’re on the hunt for stocks with the potential to exponentially grow your investment, focusing on **rapidly expanding industries** is a smart strategy. The best opportunities often lie in innovative companies that are positioned to disrupt their markets. Here, we delve into two **promising growth stocks** that could see their share prices skyrocket—**tenfold**—in the coming years. Get ready to explore these potential **multibaggers**!
Image source: Getty Images.
1. SoundHound AI: The Voice of the Future
SoundHound AI (SOUN -0.80%) has seen **remarkable volatility**, with its stock price surging **342%** since the end of 2023. What’s driving this impressive rise? Increased demand for its **cutting-edge conversational voice technology** powered by **artificial intelligence (AI)**.
Impressive Growth Metrics
In the most recent quarter, SoundHound’s revenue more than **doubled** year-over-year, fueled in part by its acquisition of Amelia last year. This acquisition enabled SoundHound to bring its voice AI technology into crucial sectors like **retail and healthcare**.
A Bright Future in AI
AI is revolutionizing how consumers interact with services, from placing orders at restaurants to in-car support systems—two burgeoning markets for SoundHound. To highlight this growth, over **1,000 new restaurant locations** adopted SoundHound technology just last quarter—an impressive **tenfold increase** compared to the previous year.
Investment Considerations
On the flip side, SoundHound is currently reporting losses, with a **non-GAAP loss of $22 million** in Q1 against **$29 million** in revenue. However, these concerns may be premature; the company has various revenue streams, including product royalties, service subscriptions, and ads from its music identification app. Additionally, SoundHound’s proprietary AI, crafted over **two decades**, bodes well for its resilience and market adaptability.
With a **strong cash position of $246 million** and **no debt**, SoundHound is well-poised to capitalize on the skyrocketing **AI voice generator market**, which is projected to grow from **$3 billion in 2024 to over $20 billion by 2030** (MarketsandMarkets).
The current **market cap** stands at approximately **$3.76 billion**, with a share price of around **$9.40**. For investors, achieving a **tenfold return** would mean the market cap needs to reach **$37.6 billion** in the next decade—an achievable target considering SoundHound’s rapid growth trajectory.
Image source: Getty Images.
2. Duolingo: The Language Learning Leader
Duolingo (DUOL -1.26%) is revolutionizing the online language learning space. Since its inception in **2012**, it has become the top-grossing mobile learning app across both **Google Play** and the **Apple App Store**, with its stock soaring **241%** since its public debut in 2023.
Engagement and Monetization
What makes Duolingo compelling? The app has amassed **130 million monthly active users**, signifying a **33% year-over-year growth**. Even more impressive is the **46.6 million daily active users**, a **49% increase** year-over-year, highlighting the platform’s high engagement levels.
Duolingo operates on a freemium model, allowing users to start at no cost while offering **premium content** for those willing to pay. Currently, over **10 million paying users** contribute to its **$230 million** quarterly revenue—an increase of **38%** from the previous year—while Duolingo reported a healthy profit of **$35 million**.
The Market Outlook
The online language learning market is set to grow at an impressive **21% annualized rate through 2030**, projected to reach a value of **$44 billion** (Mordor Intelligence). The integration of AI into Duolingo’s services will only accelerate this growth. Its latest feature, the **Max subscription service**, introduces **AI-powered enhancements**, further solidifying its competitive edge.
Beyond language learning, Duolingo is diversifying its offerings with courses in math and music, making it a versatile platform. Recent expansions, including courses on chess, demonstrate its strategy for long-term growth.
Currently, Duolingo holds a **market cap** of **$21.8 billion** with a share price near **$480**. To achieve a **tenfold return**, its market cap needs to scale to **$210 billion** over the next decade. This requires maintaining an annual revenue growth of **25%**, although its current growth exceeding **40%** positions it favorably ahead of market trends. Coupled with its expansive content strategy, Duolingo is undoubtedly **a compelling growth stock** for savvy investors seeking multibagger returns.
For those on a journey into the exciting world of investment, keep an eye on these stocks and stay informed about market opportunities with **The Motley Fool**.
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet and Apple. The Motley Fool recommends Duolingo. The Motley Fool has a disclosure policy.
