3 Stocks Well Below 52-Week Highs With Strong Growth Projections

November 01, 2024 at 07:15 AM EDT

KONSKIE, POLAND - JULY 21, 2018: Micron Technology website displayed on a modern smartphone — Stock Editorial Photography

These three stocks have dropped over 30% from their 52-week highs. At the same time, analysts expect strong revenue and earnings growth for them soon. These forecasts show positive outlooks for the firms. But, they also place high expectations that are important to stay aware of. Their stock prices will be judged on whether they meet these strong prospects.

Remitly: Streamlining Payments Across Borders

Remitly (NYSE: RELY) is an interesting business. It helps immigrants, who have often moved to more developed countries, send money to their families in their home country, known as remittance. The company receives revenue by charging fees on money transfers and adding a spread when it converts currencies. The firm's main value over other payment apps is its compliance with international money transfer regulations. Remitly is currently in second place behind Wise (OTCMKTS: WPLCF) in terms of active customers but is growing the number faster, at 35% in the last quarter.

Remitly is trading 36% below its 52-week high based on an Oct 30 after-hours share price of $17.63. Strong results sent shares up over 15%. Earnings and revenue growth are expected to be strong over the next two years. In fiscal 2025, analysts expect revenue to increase by 26% and adjusted earnings per share (EPS) to increase by 76%. Analysts project that fiscal 2026 will be a turning point. They see non-adjusted EPS turning positive for the full year. Adjusted EBITDA margin could rise several hundred basis points from current levels. Note that these estimates are likely to change as the company raised its full-year revenue guidance and posted higher-than-expected earnings on Oct. 30.

It's important to point out that immigration analysts see the pace of immigration in the U.S., where Remitly gets two thirds of its revenue, slowing. This may decrease growth in the company’s users, revenue and earnings.

TransMedics: Extending Lives and Expecting Growing Profits

Next is TransMedics Group (NASDAQ: TMDX). The company makes devices that boost organ transplant success rates. They do this by extending the time organs can survive outside the body. Typically, when an organ donor dies, the organs begin to deteriorate quickly once removed. TransMedics' Organ Care System (OCS) technology simulates body conditions to keep them viable for longer. This helps ensure organs can survive transport and remain in optimal condition until they reach the recipient.

TransMedics is trading 54% below its 52-week high but has been a very strong investment over the past three years, up nearly 200%. However, the company is going through a rough patch. It missed massively on net income and substantially on revenue in its latest results, leading to significant analyst downgrades.

Still, the company is projecting 80% revenue growth for the full 2024 year compared to 2023. Additionally, analysts expect adjusted EPS to rise by over 10 times from 2023. In 2025, analysts expect a 26% revenue rise and a 65% jump in adjusted EPS. They also expect a big rise in operating margin.

Micron: Expecting Big Sales Gains Despite China Concerns

Last is Micron Technology (NASDAQ: MU). This semiconductor company specializes in the memory chip part of the market as opposed to the logic chip market. The stock is down 34% from its 52-week high. The company’s failure to raise its guidance outlook back in June has contributed to the slide in the stock price. Additionally, the Wall Street Journal points out that increases in the Chinese production capacity of advanced memory chips may be having an effect. It could slow the recovery of the market by creating an oversupply, putting downward pressure on prices.

The more immediate impact is the increase already occurring in the supply of less advanced chips in China. Those are the main chips Micron supplies in China. However, Chinese revenue only makes up 12% of the company’s total. Still, the Chinese supply increase can affect prices of lower-end chips globally, to which Micron still has significant exposure. Despite concerns, analysts are forecasting strong revenue increases for Micron in 2025, with the figure projected to rise by 52%. Analysts expect growth to slow afterward, dropping to 21% in 2026.

Analysts expect adjusted EPS to increase nearly seven times from 2024 and to rise another 44% in 2026, before falling in 2027. Micron saw strong growth across all of its segments in the last quarter.

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3 Stocks Well Below 52-Week Highs With Strong Growth Projections

Remitly: Streamlining Payments Across Borders

TransMedics: Extending Lives and Expecting Growing Profits

Micron: Expecting Big Sales Gains Despite China Concerns

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