Are Aviva plc, Coms plc And Imagination Technologies Group plc Capable Of 20%+ Returns?

Shares in smart building solutions provider Coms (LSE: COMS) have risen by over 10% today after it announced a contract win. Its core operating division, Redstone, has won a strategically significant contract to design and install an in-building cellular system in London. It will allow people to use their mobile phones and mobile-connected devices where signal strength could otherwise be an issue and is worth £0.75m.

The deal is the first in-building cellular contract of this scale in the UK and highlights Coms’ ability to cross-sell, with the client being an existing customer of the business. It also highlights the potential of the technology over the medium-to-long term, with Coms being well-placed to benefit from the continued requirement for faster download speeds and better reception across the UK’s main business areas.

Although Coms remains a relatively high-risk play, it appears to be moving in the right direction. And with it having a net cash position and a new strategy, it could be worth buying for less risk-averse investors due to the potential for a further 20% upside.

Imagining a brighter future?

At the other end of the performance spectrum are shares in Imagination Technologies (LSE: IMG). They’ve fallen by 35% in the last six months following a profit warning, although investor sentiment is on the up. This is evidenced by their rise of 33% in the last month.

Looking ahead, Imagination Tech has considerable turnaround potential following its announcement that it expects to make a loss in the current financial year. It has already decided to dispose of its consumer electronics business, Pure, and will implement a major restructuring as it seeks to reduce operating costs by as much as £15m. And with a major review set to report later this year, its business model could rapidly change and improve, with a new strategy likely once a new permanent CEO is found.

With such major changes ongoing, Imagination Tech is a relatively risky buy at the moment. As such, and while it has a bright long-term future, it may be prudent to await more information regarding its turnaround plans before buying a slice of it.

Ready for take-off

Meanwhile, Aviva (LSE: AV) has the potential to deliver returns above and beyond 20% over the medium-to-long term. It continues to trade at a considerable discount to the wider index and while there’s a risk that its combination with Friends Life will be less successful than envisaged, the reality is that the merger is on track to deliver vast synergies and is set to create a dominant life insurance provider.

This doesn’t appear to be reflected in Aviva’s valuation, with the company’s shares trading on a price-to-earnings (P/E) ratio of 8.7. If they were to trade 20% higher, they would still have a rating of just 10.4, which indicates that there’s much more than 20% of capital gains in the pipeline for Aviva. And with the company’s shares having a yield of 5.6%, they offer excellent income prospects. This could be the catalyst to push them higher, as well as continued success with the recent merger.

Despite this, there's another stock that could outperform Aviva in the coming years. In fact it's been named as A Top Growth Share From The Motley Fool.

The company in question could make a real impact on your bottom line in 2016 and beyond. And in time, it could help you retire early, pay off your mortgage, or simply enjoy a more abundant lifestyle.

Click here to find out all about it – doing so is completely free and comes without any obligation.

Peter Stephens owns shares of Aviva. The Motley Fool UK owns shares of Imagination Technologies. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.