I think these UK growth shares could potentially double your money

Growth shares can make you a lot of money. Pick the right stocks, and you can potentially double (or triple) your money over time.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

Growth shares can make you a lot of cash. Pick the right stocks, and you could double your money. Over the years, I’ve personally doubled my money on a number of UK growth shares including ASOS, GB Group and dotDigital.

Today, I’m going to highlight two UK growth shares that I believe have the potential to double investors’ money (over the medium-to-long term, of course). In my view, both of these companies look set for strong gains over time.

An innovator in digital monetisation

The first UK growth share I want to highlight is Cerillion (LSE: CER).

It’s a leading provider of billing, charging, and customer management systems. The company has delivered 90 customer installations worldwide and has a proven track record of delivering cost-effective, cloud-based (SaaS) solutions. Its vision is to be the enabler of seamless digital experiences for the world’s communications and subscription businesses.

Cerillion’s half-year results, issued in May, showed that the company has significant momentum right now. Revenue was up 46% to £10.2m reflecting implementation work on five major new contract wins. Adjusted EBITDA was up 673% to £2.7m. Meanwhile, new orders were up 28% year-on-year to £9.5m. It’s also worth mentioning that the company increased its dividend by 9%, which suggests that management is confident about the future.

Cerillion currently sports a forward-looking P/E ratio of what I think is a reasonable 27 and has a market cap of just £96.5m. If the company can continue growing at a healthy rate, I think we could see the company’s market cap double in time. Of course, the stock is not going to double up overnight. But in my view, this growth share has all the right ingredients to double your money.

A disruptive growth share 

Another UK growth share I think could potentially do that is Keystone Law (LSE: KEYS). It’s an innovative ‘platform-based’ UK law firm that is disrupting the legal industry by enabling lawyers to work from home or their own offices. It has over 350 lawyers on its platform (it believes its addressable market is 47,000 lawyers) and serves clients across a range of industries.

Keystone Law shares have underperformed due to Covid-19. This is not a surprise, as the demand for some legal services (such as those associated with transactions) will have declined.

I see this share price weakness as a great buying opportunity. The group is in a strong financial position, and its model is designed to service clients remotely. So it’s well placed to deal with any near-term challenges.

In August, Keystone announced that it had appointed 15 new partners from several of the UK’s top law firms. These hires highlight the attraction of the group’s virtual business model. “Now that many lawyers have been working remotely during lockdown, the appetite for an alternative to the traditional law firm model is stronger than ever,” commented CEO James Knight. The group also announced that it has finalised arrangements to launch offices in the Middle East. It clearly has momentum right now.

Keystone Law currently trades on a forward-looking P/E ratio of about 31 using next year’s EPS forecast and sports a market cap of about £137m. If it can continue growing at a healthy pace, I think it could easily double its market cap over time. I’d buy this UK growth share today.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be considered so you should consider taking independent financial advice.

Edward Sheldon owns shares in Keystone Law, ASOS, GB Group, and dotDigital. The Motley Fool UK has recommended ASOS and dotDigital Group. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

Bearded man writing on notepad in front of computer
Investing Articles

Is there still time to buy Scottish Mortgage shares?

The Scottish Mortgage share price has risen strongly in recent weeks. Should I pile into the FTSE 100 momentum stock…

Read more »

Smiling white woman holding iPhone with Airpods in ear
Investing Articles

Why I’d start buying shares with £250 today not £20,000 in future!

Is it worth waiting to start buying shares until one has more money to invest? Our writer doesn't think so…

Read more »

Playful senior couple in aprons dancing and smiling while preparing healthy dinner at home
Investing Articles

I’ve bought Diageo shares to boost my long-term passive income!

I plan to hold on to my Diageo shares well into retirement. Here's why I think it's a top stock…

Read more »

New virtual money concept, Gold Bitcoins
Investing Articles

Down 61%, are Argo Blockchain shares worth buying?

Argo Blockchain shares have tumbled in value. As a shareholder, Christopher Ruane considers what might come next for the business…

Read more »

Smiling young man sitting in cafe and checking messages, with his laptop in front of him.
Investing Articles

3 UK dividend stocks with yields over 10%

These dividend stocks are the highest yielders on the UK market, says Roland Head. But how safe are these generous…

Read more »

Couple relaxing on a beach in front of a sunset
Investing Articles

I’d start buying shares for passive income with this pair

Our writer is looking to earn passive income via investing, and here are two leading stocks he might buy.

Read more »

Tanker coming in to dock in calm waters and a clear sunset
Investing Articles

Here’s the Shell dividend forecast through to 2024

The Shell dividend is still nearly 50% below 2019 levels. Will the oil giant use record profits to rebuild its…

Read more »

Warren Buffett at a Berkshire Hathaway AGM
Investing Articles

3 FTSE 100 stocks I think Warren Buffett might love!

Warren Buffett made his fortune thanks to the success of US shares. But here are three FTSE 100 stocks I…

Read more »