Investors looking for ways to maximize their opportunities to generate massive returns in the stock market should turn their attention towards small-cap stocks. Generally, these are companies that have a market cap of $5 billion or less. The reason these companies have a better chance of making investors richer than larger companies is that it’s much easier for smaller companies to sustain high growth rates. With that in mind, here are three small-cap stocks that could triple in value by 2030!
A growth stock with a winning playbook
When Topicus.com (TSXV:TOI) started trading earlier this year, the company had a big advantage over many other IPOs. It entered the public markets with a winning playbook developed by one of the biggest companies in its industry. How did Topicus manage to do this? Prior to its IPO, the company was a subsidiary of Constellation Software, one of the largest Canadian tech companies and a prolific acquirer of vertical market software companies.
Like Constellation, Topicus aims to acquire VMS businesses and help build them into great companies. The company differentiates itself by focusing on the highly fragmented European tech industry. Many analysts have equated an investment in Topicus today to be like an investment in Constellation Software in 2010. Although it’s tough to assume Topicus will be able to generate the same kinds of returns that Constellation has generated over the past decade, if it’s able to perform even half as well, investors will see massive returns.
A dividend company with a tremendous history of growth
When looking at growth stocks, investors should give extra attention to those that have a solid history of growth. Unfortunately, it’s very difficult to find small-cap stocks that have a long and successful history in the public markets. However, in the case of goeasy (TSX:GSY), that’s exactly what we have. goeasy stock has managed to gain 177% over the past year.
The company provides high-interest loans to subprime borrowers and sells furniture and other home goods on a rent-to-own basis. Because of the nature of its business, it’s easy to see why goeasy’s financials have been on an upward trajectory since the start of the pandemic. In fact, since hitting its lowest point during last year’s market crash, goeasy stock has gained more than 550%. goeasy is also a tremendous dividend stock, having increased its distribution by more than 770% over the past seven years.
A promising stock could change the healthcare industry
WELL Health Technologies (TSX:WELL) has been a very impressive stock over the past four years. In its three years prior to joining the TSX, WELL Health was one of the leading performers on the TSXV. In 2020, the company graduated to the TSX and continued its hot run gaining over 400%. With the telehealth industry expected to grow at a CAGR of 26.5% from 2021 to 2026, WELL Health could see a lot more growth from here.
The company has done an excellent job of expanding into the American healthcare industry. The acquisitions that the company has made, facilitating that expansion, provides it with a much larger potential userbase. One note that investors should consider when investing in such a disruptive company like WELL Health is the risk of investing too early. If investors believe that the telehealth industry is much too early in its adoption curve, WELL Health could suffer in the short to medium term.