In this article, we discuss 12 best multibagger stocks to buy now. If you want to see more stocks in this selection, check out 5 Best Multibagger Stocks to Buy Now.
In this uncertain market backdrop, investors are focused on macroeconomic and geopolitical constraints and their potential effects on investment portfolios. Goldman Sachs believes the U.S. will avoid a recession in 2023, and even if a recession were to occur, it would be comparatively moderate given the strong underlying U.S. fundamentals. Although inflation and rampant interest rates remain the most significant short-term challenges, global factors like the war in Ukraine and China’s regional power and internal conditions are also impacting investor sentiment.
Despite the volatile economic conditions, history indicates that during turbulent market spreads, investors should stay long and remain invested. To cope with the market turbulence, many investors have shifted their portfolios towards defensive and value equities to combat the taxing headwinds which they presently face. As per Goldman Sachs, investors should focus on quality stocks that are US-listed, benefit from a strong dollar, and display fortress balance sheets.
In the first half of 2023, the S&P 500 is expected to mimic the declines of 2022, but a pivot from the Fed could support an asset recovery in the later half of the year, taking the S&P 500 to 4,200 by the end of 2023. Keeping this in mind, investors often pick up large-cap stocks like Amazon.com, Inc. (NASDAQ:AMZN), Apple Inc. (NASDAQ:AAPL), and NVIDIA Corporation (NASDAQ:NVDA). However, we discuss some of the best multibagger stocks in this article.
Our Methodology
We selected the following stocks based on share price gains of more than 200% over the last year as of December 13. These stocks are ranked according to their share price gains. We have assessed the hedge fund sentiment from Insider Monkey’s database of 920 elite hedge funds tracked as of the end of the third quarter of 2022.
1-Year Share Price Gain as of December 13: 192.00%
Number of Hedge Fund Holders: 23
CTI BioPharma Corp. (NASDAQ:CTIC) is a Washington-based biopharmaceutical company focused on the acquisition, development, and commercialization of novel targeted therapies for blood-related cancers in the United States. On November 7, CTI BioPharma Corp. (NASDAQ:CTIC) reported a Q3 GAAP loss per share of $0.13 and a revenue of $18.2 million, outperforming Wall Street estimates by $0.03 and $1.03 million, respectively. The stock traded 17.5% higher on November 8 after the company posted better-than-expected Q3 results.
On October 17, investment advisory SVB Securities initiated coverage of CTI BioPharma Corp. (NASDAQ:CTIC) with an Outperform rating and a $13 price target. Analyst Andrew Berens issued the ratings update.
According to the third quarter database of Insider Monkey, 23 hedge funds held stakes worth nearly $194 million in CTI BioPharma Corp. (NASDAQ:CTIC), compared to 17 funds in the earlier quarter worth $158 million. Mark Lampert’s Biotechnology Value Fund / BVF Inc is the leading position holder in the company, with 8.81 million shares worth $51.3 million.
Like Amazon.com, Inc. (NASDAQ:AMZN), Apple Inc. (NASDAQ:AAPL), and NVIDIA Corporation (NASDAQ:NVDA), CTI BioPharma Corp. (NASDAQ:CTIC) is one of the best stocks to invest in for a winning portfolio.
11. Alpha Metallurgical Resources, Inc. (NYSE:AMR)
1-Year Share Price Gain as of December 13: 206.58%
Number of Hedge Fund Holders: 27
Alpha Metallurgical Resources, Inc. (NYSE:AMR) was incorporated in 2016 and is headquartered in Bristol, Tennessee. It is a mining company that produces, processes, and sells met and thermal coal in Virginia and West Virginia. On November 28, Alpha Metallurgical Resources, Inc. (NYSE:AMR) provided operational guidance for 2023, including a raise in full-year total shipments to 16.7 million-18.4 million tons, with 15 million-16 million metallurgical tons expected to account for the majority of the total.
On November 8, Cowen analyst Lance Vitanza maintained an Outperform rating on Alpha Metallurgical Resources, Inc. (NYSE:AMR) but lowered the price target on the shares to $215 from $225. The analyst said in addition to strong Q3 results, the company reported a significant increase in its return of capital to shareholders with a $400 million addition to its repurchase program, an $80 million one-time special dividend, and a $0.03 increase to its regular dividend, all of which conveys confidence in the outlook.
According to Insider Monkey’s data, 27 hedge funds were long Alpha Metallurgical Resources, Inc. (NYSE:AMR) at the end of the third quarter of 2022, compared to 25 in the prior quarter. Jim Simons’ Renaissance Technologies is the largest stakeholder of the company, with 819,915 shares worth $112 million. It is one of the best multibagger stocks favored by elite hedge funds.
1-Year Share Price Gain as of December 13: 222.70%
Number of Hedge Fund Holders: 25
Prometheus Biosciences, Inc. (NASDAQ:RXDX) is a California-based biopharmaceutical company that engages in the discovery, development, and commercialization of novel therapeutics and companion diagnostics products for the treatment of inflammatory bowel diseases. On December 7, Prometheus Biosciences, Inc. (NASDAQ:RXDX) announced that its medicine PRA023 indicated robust efficacy and favorable safety in two mid stage trials in patients with ulcerative colitis and Crohn's disease. Prometheus Biosciences, Inc. (NASDAQ:RXDX) plans to advance PRA023 into phase 3 studies for these trials in 2023.
On December 8, Credit Suisse analyst Tiago Fauth raised the price target on Prometheus Biosciences, Inc. (NASDAQ:RXDX) to $142 from $59 and maintained an Outperform rating on the shares following ulcerative colitis and Crohn's disease data. The debate is now shifting to the potential size of the class. The analyst believes present market dynamics in inflammatory bowel disease remain favorable for a likely best-in-class asset such as PRA023.
According to Insider Monkey’s Q3 data, Prometheus Biosciences, Inc. (NASDAQ:RXDX) was part of 25 hedge fund portfolios, compared to 20 in the prior quarter. Bihua Chen’s Cormorant Asset Management is the largest stakeholder of the company, with approximately 2 million shares worth $116.8 million.
1-Year Share Price Gain as of December 13: 227.17%
Number of Hedge Fund Holders: 8
Hallador Energy Company (NASDAQ:HNRG) is one of the best multibagger stocks to monitor. The company is based in Indiana, and it engages in the production of steam coal in the State of Indiana for the electric power generation industry. On November 3, Hallador Energy Company (NASDAQ:HNRG) reported Q3 GAAP EPS of $0.05 and a revenue of $85.08 million, up 6.60% on a year-over-year basis. The company’s fundamentals continue to improve as coal prices remain resilient. With shares up over 227% over the last year as of December 13, Hallador Energy Company (NASDAQ:HNRG) is one of the best performing stocks this year.
According to Insider Monkey's Q3 data, 8 hedge funds were bullish on Hallador Energy Company (NASDAQ:HNRG), compared to 5 funds in the prior quarter. Aaron Weitman's CastleKnight Management is the largest stakeholder of the company, with 1.18 million shares worth $6.64 million.
Here is what Cove Street Capital specifically said about Hallador Energy Company (NASDAQ:HNRG) in its Q2 2022 investor letter:
“Hallador Energy Company (NASDAQ:HNRG) is a… (get ready for it) … coal company. They have an unusual asset position – a very low cost basis in the Illinois Basis – almost all of which is thermal coal used in electricity generation. You might have noticed that the United States is theoretically attempting to transition our power needs in a ten-year plan when the reality is that 50 is probably the realistic number. The drive to this unrealistic goal is producing a severe shortage of “baseline” power production, which is simply not a good thing. Our bet is that Hallador’s assets are worth a lot more and will generate cash for a lot longer than is being priced in by the market. There is an interesting and financially savvy board guiding the CEO. In a new and interesting twist, the company essentially is being “given” a coal fired power plant in their backyard due to political issues. This could represent an enormous piece of upside subject to the vagaries of regulation and weather. Although we have followed the company for many years, this was a new buy in the quarter.”
1-Year Share Price Gain as of December 13: 243.93%
Number of Hedge Fund Holders: 31
CONSOL Energy Inc. (NYSE:CEIX) was founded in 1860 and is headquartered in Canonsburg, Pennsylvania. The company produces and exports bituminous coal in the United States, operating through PAMC, CONSOL Marine Terminal, and Other segments. CONSOL Energy Inc. (NYSE:CEIX) engages in the mining, preparation, and marketing of bituminous coal, serving power generators, industrial, and metallurgical end-users. The company reported a Q3 net income of $152.1 million and a quarterly free cash flow of $107.1 million. 2023 and 2024 contracted positions improved to 21.8 million tons and 8.8 million tons, respectively.
On November 2, Benchmark analyst Nathan Martin raised the price target on CONSOL Energy Inc. (NYSE:CEIX) to $80 from $72 and maintained a Buy rating on the shares. Though CONSOL Energy Inc. (NYSE:CEIX) posted Q3 adjusted EBITDA that "slightly" fell short of consensus, lower shipments were likely the driver and management believes it is done with those issues, the analyst said. He believes CONSOL Energy Inc. (NYSE:CEIX) should reach its targeted debt level of $300 million in the coming quarters and "at that point we think cash returns will accelerate," the analyst added.
According to Insider Monkey’s data, 31 hedge funds were long CONSOL Energy Inc. (NYSE:CEIX) at the end of Q3 2022, with collective stakes worth $360.65 million, compared to 23 funds in the prior quarter worth $272.5 million. David Einhorn’s Greenlight Capital is the largest stakeholder of the company, with 1.71 million shares valued at $110 million.
Greenlight Capital made the following comment about CONSOL Energy Inc. (NYSE:CEIX) in its Q3 2022 investor letter:
“CONSOL Energy Inc. (NYSE:CEIX) shares rose from $49.38 to $64.32. As we wrote last quarter, we expect the company to generate approximately $50 per share in after-tax free cash flow by the end of 2023. The company paid its first dividend of $1 per share in August and also announced a policy of distributing at least 35% of its free cash flow to its shareholders. We would emphasize the “at least” part and see room for the percentage to expand as the cash flows materialize. Coal markets have remained quite strong and visibility is improving, such that 2024 looks to us like another strong year.”
1-Year Share Price Gain as of December 13: 245.15%
Number of Hedge Fund Holders: 8
Sigma Lithium Corporation (NASDAQ:SGML) is a Canadian firm that engages in the exploration and development of lithium deposits in Brazil. Sigma Lithium Corporation (NASDAQ:SGML) stock gained 7.9% pre-market on December 5 after revealing plans to nearly triple its planned production of battery grade lithium concentrate to approximately 100,000 metric tons per year of lithium carbonate equivalent by 2024 after positive results from a study at its Grota do Cirilo project in Brazil. The Canadian miner plans to begin commissioning Grota do Cirilo this month, with production starting by April 2023. With shares up over 245% in the last year as of December 13, Sigma Lithium Corporation (NASDAQ:SGML) is one of the best multibagger stocks to invest in.
On December 5, Canaccord analyst Katie Lachapelle raised the firm's price target on Sigma Lithium Corporation (NASDAQ:SGML) to C$64 from C$45 and kept a Speculative Buy rating on the shares.
According to Insider Monkey’s Q3 data, Sigma Lithium Corporation (NASDAQ:SGML) was part of 8 hedge fund portfolios, with collective stakes worth $45.5 million, compared to 3 funds in the prior quarter worth $23.7 million. Jack Ripsteen’s Potrero Capital Research is the leading position holder in the company, with 596,930 shares valued at $16.2 million.
1-Year Share Price Gain as of December 13: 289.59%
Number of Hedge Fund Holders: 15
TORM plc (NASDAQ:TRMD) is a Denmark-based product tanker company that engages in the transportation of gasoline, jet fuel, naphtha, and crude oil worldwide. On November 10, TORM plc (NASDAQ:TRMD) reported Q3 GAAP earnings per share of $2.63 and a revenue of $448.1 million, up 188.2% year-over-year and beating Wall Street estimates by $106.85 million. The company paid a per share quarterly dividend of $1.46 to shareholders on December 8.
On May 25, Pareto analyst Eirik Haavaldsen initiated coverage of TORM plc (NASDAQ:TRMD) with a Buy rating and a DKK 140 price target. The company could pay out dividends equal to 40% of its market value over the next three years, and tanker spot rates "are going ballistic", the analyst told investors in a research note.
According to Insider Monkey’s Q3 data, 15 hedge funds were long TORM plc (NASDAQ:TRMD), compared to 12 funds in the prior quarter. The collective stakes held by elite funds in Q3 2022 increased to $1.16 billion from $760 million in Q2 2022. Howard Marks’ Oaktree Capital Management is the largest position holder in the company, with 53.8 million shares valued at $1.10 billion.
In addition to Amazon.com, Inc. (NASDAQ:AMZN), Apple Inc. (NASDAQ:AAPL), and NVIDIA Corporation (NASDAQ:NVDA), TORM plc (NASDAQ:TRMD) is one of the stocks on the radar of smart investors as they head into 2023.
