When you consider that the S&P 500 returned about 9% annually on average over the last 30 years, a fivefold gain in just five years amounts to a monumentally high return. You have to be extremely selective when looking for such gains, finding stocks that combine a reasonable valuation and tremendous growth potential. Even then, earning such a high return is rare.
Nonetheless, you can find numerous examples of stocks that have made such gains in previous bull markets. When considering both valuation and growth potential, these two consumer goods stocks are among those I think have the potential to possibly turn $1,000 into $5,000.
Image source: Getty Images.
Celsius Holdings
Celsius Holdings(NASDAQ: CELH) has risen to prominence in the energy-drink market by taking a different approach to marketing. Indeed, it lags market leaders Red Bull and Monster Beverage in terms of market share.
Image source: Statista.
Nonetheless, it has stood out by marketing itself to the fitness community, using more-natural ingredients and participating in studies to confirm the health benefits of its drinks.
Moreover, Celsius beverages found a new level of popularity when it signed a long-term distribution agreement with PepsiCo in 2022. The agreement gave it valuable shelf space in key stores, dramatically increasing its sales.
More recently, it will increase its market share by buying out its peer Alani Nu, which became effective on April 1. It recently exceeded $1 billion in sales over the last year.
Still, much of the potential for gains comes from a massive pullback in the stock price. In 2024, its shares dropped when a key distributor, likely PepsiCo, suddenly reduced its purchases. That led to the stock losing over 75% of its value at one point.
Indeed, its performance continued to suffer as its revenue in the first quarter of 2025 dropped 7% yearly to $329 million. That was a slowdown from the 4% decline in Q4, but an improvement from Q3, when sales pulled back 31% from year-ago levels.
However, analysts forecast revenue gains of 55% in 2025 amid the Alani Nu takeover, and a 21% increase in 2026. Since that brought earnings growth forecasts of 22% this year and 38% in 2026, that's my argument for how a fivefold growth rate over the next five years could be within reach.
Additionally, Celsius has barely begun to tap international markets, which are on track to become a major revenue source five years from now. About 7% of sales were international in Q1, but that was up from the 5.5% of sales coming from outside the U.S. in 2024. That part of the business has grown revenue by 41% in Q1, even as U.S. sales slowed. Thus, if it can continue to expand its international sales, it could make the revenue gains necessary to continue its rapid profit increases.
Finally, even though Celsius stock has begun to recover, it sells at a 79 price-to-earnings ratio (P/E) and a 40 forward P/E ratio. That coming drop in the earnings multiple should limit the downside on the stock as it positions itself for a return to growth.
Roku
Roku(NASDAQ: ROKU) stock may not seem like a five-bagger in the making, considering that it sells for more than 88% below its 2021 high.
However, even as the stock price fell from its pandemic highs, Roku managed to increase the size of the user base, and the hours streamed on the platform exceeded user growth. In the fourth quarter, the user base rose 12% to 90 million as streaming hours rose by 18%, indicating users continue to spend more time on its platform.
Indeed, a closer look at the company itself seems to make a compelling case for buying its shares. It has become the largest platform for streaming TV, bringing content providers, viewers, and advertisers together. Consequently, it is now the No. 1 platform in the U.S., Canada, and Mexico, and it is steadily expanding its footprint across Latin America and Europe.
With such market victories, its revenue of $1 billion in the first quarter of 2025 rose 16%. That was a slight slowdown from 2024, when revenue of $4.1 billion grew 18% yearly. Also, even though it has not turned profitable, the $27 million loss in the first quarter was a vast improvement from the $51 million lost in the year-ago quarter.
Moreover, the financial improvements could turn the company profitable by next year. Also, it has increased its revenue growth since the 2022 bear market, which, with the likely rapid profit increases, could spark a renewed interest in Roku stock.
Furthermore, its free cash flow (FCF) in the first quarter was $203 million, a 16% yearly gain. This seems to be a trend, as its 2024 FCF of $203 million also rose 16% annually. That positive FCF is an indication it may finally turn profitable.
It lacks a P/E ratio since it earned no profits, but thanks to the lower stock price, it sells at a price-to-sales ratio (P/S) of just under 2.1, down from over 30 during the pandemic. That makes Roku a growth stock with a valuation more closely resembling a value stock. Hence, between its near profitability and potential for multiple expansion, a five-fold growth rate over the next five years is a significant possibility.
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Will Healy has positions in Celsius and Roku. The Motley Fool has positions in and recommends Celsius, Monster Beverage, and Roku. The Motley Fool has a disclosure policy.
