These three contrarian stock picks can be very profitable for long-term investors
On Wall Street zeroes can become heroes relatively quickly. For example, in the past the Street hated Roku (NASDAQ:ROKU), Intel (NASDAQ:INTC), Shopify (NYSE:SHOP) and Pinterest (NYSE:PINS) and now they’re all among the most beloved names in the stock market. Often, positive macro trends can explain the transformation. For example, Roku and Pinterest got a big boost due to the acceleration of advertising spending. Obviously, investors can make a great deal of money by correctly predict which names will go from hated to loved within a year. Here are three contrarian stock picks which I believe are very well-positioned to make the journey in the next 12 months.
Bionano’s (NASDAQ:BNGO) products use a method called optical genome mapping (OGM) to identify structural variations within DNA missed by other methods. OGM is clearly becoming much more popular among healthcare professionals as seen in BNGO’s recent financials. The company reported that its revenue had climbed 27% to 30% last quarter versus the same period a year earlier. Moreover, it estimated that the number of flowcells that it had sold had soared 67% year-over-year to nearly 8,000. Flowcells, which are used to facilitate OGM, are the firm’s main source of revenue.
Also noteworthy is that CEO Erik Holmlin stated in November that the firm had been in contact with the U.S. Food and Drug Administration in an effort to obtain the agency’s approval for an OGM test. In order to obtain the approval, the firm will have to conduct a relatively small clinical study this year, the CEO explained.
Such an approval, which sounds as though it could come at the end of this year or in the first half of 2025, would likely result in many insurers covering the test, causing many more labs to utilize it and tremendously lifting BNGO stock.
As a result, I view BNGO as one of the best contrarian stock picks at this point.
Plug Power (PLUG)
Plug Power (NASDAQ:PLUG) continues to make progress in its drive to develop a comprehensive, profitable hydrogen ecosystem. On Dec. 27, PLUG announced that it had successfully deployed and launched an electrolyzer system at an Amazon (NASDAQ:AMZN) plant in Colorado.
This is the first time that Amazon has deployed such an electrolyzer which utilizes electricity and water to produce hydrogen which is used to power hydrogen fuel cell-powered forklift trucks. I’m optimistic that Amazon will utilize PLUG’s electrolyzers at dozens more of its plants over the next year. If that prediction comes true it would meaningfully lift PLUG’s top and bottom lines.
Further, the huge freight-train company, Union Pacific (NYSE:UNP), is utilizing PLUG’s hydrogen fuel-cell power generators. Specifically, the company had deployed 67 of these generators as of Dec 27. I’m confident that many other sizeable firms will utilize large numbers of PLUG’s generators over the longer term, giving PLUG stock a meaningful lift.
Despite the media’s hand wringing about the lack of growth of electric vehicles in America, EVs are actually continuing to proliferate fairly rapidly in the U.S. Last quarter, 8% of all the vehicles sold in the country were EVs. That represented a 40% increase versus the same period a year earlier. Meanwhile, Bloomberg predicts that nearly 1.9 million EVs will be provided to customers this year, up from almost 1.2 million in 2023.
That growth should tremendously benefit EVgo (NASDAQ:EVGO) which has one of the largest networks of fast EV chargers in the country.
And that network is in a position to greatly increase in 2024, as EVgo, in partnership with General Motors (NYSE:GM) and Warren Buffet-owned convenience store operator Pilot, intends to add roughly 200 charging stations this year.
On the date of publication, Larry Ramer held long positions in BNGO,PLUG, and EVGO. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.