𝟯 𝗦𝗧𝗢𝗖𝗞𝗦 𝗜'𝗺 𝗕𝗨𝗬𝗜𝗡𝗚 𝗶𝗻 𝗔𝗣𝗥𝗜𝗟 𝟮𝟬𝟮𝟭
As you know, I had a tenbagger in my portfolio earlier this year, GameStop $GME . This is a stock which I first bought in September 2019 and although I expected that it could be a tenbagger in less than 2 years because of the new console cycle and short squeeze, we should not expect this to happen to every stock. By definition, 𝙖 𝙩𝙚𝙣𝙗𝙖𝙜𝙜𝙚𝙧 𝙞𝙨 𝙖 𝙨𝙩𝙤𝙘𝙠 𝙬𝙝𝙞𝙘𝙝 𝙜𝙖𝙞𝙣𝙨 𝟵𝟬𝟬% 𝙤𝙧 𝟭𝟬𝙓 𝙞𝙣 𝟭𝟬 𝙮𝙚𝙖𝙧𝙨 𝙤𝙧 𝙡𝙚𝙨𝙨. The 3 stocks I'm buying in April are all potential tenbaggers.
🏠 Essent Group $ESNT
Essent Group is one of the 6 private mortgage insurance businesses in the US and looking at the metrics of the business, I'll say that it is the best in the industry. There's even a premium on the stock and the company may buyback shares or increase dividends (which they started paying last year). There are many 𝙩𝙖𝙞𝙡𝙬𝙞𝙣𝙙𝙨 𝙛𝙤𝙧 𝙝𝙤𝙪𝙨𝙞𝙣𝙜 𝙖𝙣𝙙 𝙘𝙤𝙣𝙨𝙚𝙦𝙪𝙚𝙣𝙩𝙡𝙮 𝙢𝙤𝙧𝙩𝙜𝙖𝙜𝙚 with the low mortgage rates, the work from trend, and asset price inflation.
💰 Genworth Financial $GNW
Genworth is another PMI but unlike Essent Group, they also have life insurance. Genworth has a market cap of $1.6 billion for a book value of $15 billion. It is massively undervalued, a 𝙙𝙚𝙚𝙥 𝙫𝙖𝙡𝙪𝙚 𝙨𝙩𝙤𝙘𝙠. The interest yield from their $80 billion portfolio is itself bigger than the current market cap. There's also the 𝙥𝙤𝙨𝙨𝙞𝙗𝙞𝙡𝙞𝙩𝙮 𝙤𝙛 𝙖𝙧𝙗𝙞𝙩𝙧𝙖𝙜𝙚 if it gets acquired by China Oceanwide. The deal now seems unlikely but at current price, this is a good investment in my opinion.
🚚 UNFI $UNFI
United Natural Foods is the largest food distributor in the US and they have a 𝙢𝙤𝙖𝙩 𝙞𝙣 𝙤𝙧𝙜𝙖𝙣𝙞𝙘 𝙖𝙣𝙙 𝙣𝙖𝙩𝙪𝙧𝙖𝙡 𝙛𝙤𝙤𝙙𝙨 with their largest customer being Whole Foods (owned by Amazon $AMZN ) and they recently renewed their contract till 2027. For $27 billion in revenues, the company has a market cap of only $1.5 billion. Another deep value stock. They have some big debt but I believe they will be able to pay it with their current cash flow and divestitures.
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Here’s the full analysis of Essent Group:
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