The Motley Fool

2 monster stocks in the making I’d buy for 2018

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.

Hulk monster
Image: Public domain

Over the course of your stock-picking career you’ll no doubt have studied your fair share of price charts, perhaps splattered with a handful of technical indicators showing moving averages, volume, and so on. Personally, I look at hundreds of charts each week to get a feel for price action and momentum, but that’s because I have a technical background, and also because I’m a little sad.

Missed opportunities

Very often you’ll come across a company that you’d previously dismissed as being too risky, only to discover some years later that the business has morphed into a £1bn monster. As investors we often have to deal with the negative emotions that arise from such missed opportunities, those who missed out on ASOS and Boohoo.Com will know exactly what I’m talking about.

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…

And if you click here we’ll show you something that could be key to unlocking 5G’s full potential...

That said, we can’t just go chasing after tomorrow’s hidden winners willy nilly – that would certainly be a recipe for disaster. The trick is to separate the wheat from the chaff, the valuable from the worthless. So today I’m looking at two AIM-listed companies that I believe could turn out to be monster stocks of the future.

Fighting fraud and cybercrime

First up is GB Group (LSE: GBG), the global specialist in identity data intelligence. The Chester-based technology group helps companies and governments fight fraud and cyber crime, specialising in areas such as fraud, risk & compliance, employee screening, and customer & location intelligence.

With both governments and individual companies becoming increasingly wary of fraud and cybercrime in particular, it will perhaps come as no surprise that GBG has more-than-doubled its revenues and pre-tax profits since 2014.

A storming year

The group boasts a strong renewal stream from its existing customer base, while also attracting new, high-profile customers to its growing portfolio. I see a bright future for GBG, with the business well positioned to meet the growing demand for identity data intelligence products.

The downside is that after a storming year, the shares are trading on very high rating of 36 times forward earnings for FY2018, so I would suggest adding it to your watch list to buy on any weakness during the coming months.

Promising cancer drugs

My second offering comes from the orient – Hong Kong to be precise. Hutchison China MediTech (LSE: HCM), better known as Chi-Med. It is an AIM-listed biopharmaceutical company focused on discovering and developing targeted therapies for oncology and immunological diseases for the global market.

Last year, global market sales of oncology drugs grew by 11% to $175.7bn making it the largest treatment area in the global pharmaceutical market, with a 17% market share. But in China, despite being home to 8.1m cancer patients, or about 20%-30% of those in the world, market sales of oncology drugs were just $7.3bn, or around 4% of the global market. This clearly indicates a huge opportunity for Chi-Med in its domestic market, as well as overseas.

Despite rapidly-growing revenues, the company is not yet profitable as funds continue to be pumped into research and development. But with a number of promising cancer drugs in the pipeline this won’t be the case for very long. The share price is riding high after more-than-doubling to £58 in the last 12 months alone, so this is another one to add to your watch list in 2018.

5 Stocks For Trying To Build Wealth After 50

Markets around the world are reeling from the coronavirus pandemic…

And with so many great companies trading at what look to be ‘discount-bin’ prices, now could be the time for savvy investors to snap up some potential bargains.

But whether you’re a newbie investor or a seasoned pro, deciding which stocks to add to your shopping list can be daunting prospect during such unprecedented times.

Fortunately, The Motley Fool is here to help: our UK Chief Investment Officer and his analyst team have short-listed five companies that they believe STILL boast significant long-term growth prospects despite the global lock-down…

You see, here at The Motley Fool we don’t believe “over-trading” is the right path to financial freedom in retirement; instead, we advocate buying and holding (for AT LEAST three to five years) 15 or more quality companies, with shareholder-focused management teams at the helm.

That’s why we’re sharing the names of all five of these companies in a special investing report that you can download today for FREE. If you’re 50 or over, we believe these stocks could be a great fit for any well-diversified portfolio, and that you can consider building a position in all five right away.

Click here to claim your free copy of this special investing report now!

Bilaal Mohamed has no position in any shares mentioned. The Motley Fool UK owns shares of and has recommended ASOS. The Motley Fool UK has recommended boohoo.com. 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.

Our 6 'Best Buys Now' Shares

Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply click below to discover how you can take advantage of this.