With the Nasdaq in bull territory after the sustained rally this year, many stocks have returned tremendous gains from their trough. Nvidia (NASDAQ:NVDA) comes to mind first, returning 250%-plus from its trough, while others like Meta Platforms (NASDAQ:META) have climbed over 200%. Lesser-known growth stocks have returned multibagger gains this year.
Clearly, the buying opportunity is gone for the vast majority of growth stocks and investors should start taking profits as a recession is on the horizon. However, there are still some depressed stocks in the market with highly promising businesses. Even with a recession, I don’t see such stocks plunging more, and they can deliver tremendous upside in a multi-year timeframe.
Let’s look at these three top millionaire-maker stocks to buy:
Luminar Technologies (LAZR)
Luminar Technologies (NASDAQ:LAZR) specializes in LiDAR technology for electric vehicles. LiDAR technology can provide higher accuracy and resolution than other sensing technologies, such as radar and cameras. It can also work in various weather and lighting conditions, and I believe it will be used by most self-driving cars in the future once it is the most cost-effective. Car manufacturers such as Volvo (OTCMKTS:VLVLY) and Xpeng (NYSE:XPEV) already have cars that use Luminar’s LiDAR technology, and the company’s tech has been gaining popularity, especially in China.
Still, it is clear that there is significant bearish sentiment about LAZR stock. Wall Street is all about profitability these days, yet the eye-watering sales growth of Luminar Technology is ignored entirely. The company expects triple-digit sales growth for the next five years, and I believe the business’ losses are worth it, considering the market share they’ve been capturing.
The concern about profitability is also overblown. Luminar Technologies expects to end the year with $300 million in liquidity and a positive gross margin.
Etsy (NASDAQ:ETSY) is a stock that performed well in the latter half of 2022 but has continued to bleed this year. The e-commerce company faced the same fate as many of its peers, where the stock’s valuation ballooned in the pandemic era but tumbled after investors realized the growth in e-commerce wasn’t sustainable.
However, while e-commerce penetration has stagnated, sales are still growing. According to Globest, e-commerce sales as a percentage of retail sales will almost double by 2030. Thus, I believe that investors can bet on ETSY for the long run, even if the near-term environment remains shaky.
Regardless, Etsy is a profitable business with a hefty cash balance. It has industry-leading operating margins, and Gurufocus’ model indicates a fair value of $300 by 2026.
Burlington Stores (BURL)
Burlington Stores (NYSE:BURL) tumbled more recently and I believe the discount here is too compelling to ignore. Even with the earnings miss, it is growing at a double-digit clip year-over-year.
Furthermore, I believe the earnings miss has translated into a great buying opportunity for the stock. Most of the company’s shortcomings have been priced in, and expectations for the future are subdued.
The financials here are reasonable, and a turnaround is long overdue. Analysts also overwhelmingly rate this a buy, implying a 49% upside potential in 12 months. $225 or more is possible in a multi-year time frame.
Lastly, I would note that the current price-to-earnings ratio is not a big concern for me. Even if the company misses EPS estimates in the future, it should still comfortably grow ~30% YOY through 2026.
On the date of publication, Omor Ibne Ehsan did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.