The search for multibagger high-growth stocks is still on, despite what has been a rough year for this grouping in 2022. Indeed, investors have gravitated toward value, rotating out of higher-growth equities at a rapid clip.
This rotation appears to still be underway, with many companies in the higher-valuation camp seeing continued selling pressure. For growth investors, this market can thus provide a difficult environment to put money to work.
That said, there are a host of companies that may be in the value bucket right now worth considering. Whether it’s energy, commodities, real estate or other sectors that have been long-forgotten, the growth potential of these more boring businesses has started to take off.
Here are three top high-growth companies I think are worthy of a look right now.
Multibagger High-Growth Stocks: Occidental Petroleum (OXY)
A top Warren Buffett holding, Occidental Petroleum (NYSE:OXY) is actually one of the more defensive value picks on this list of top growth stocks. That said, despite Occidental’s valuation multiple which is much lower than most tech stocks, this is a company which has been among the best-performing stocks over the past year.
Occidental Petroleum is a U.S.-based hydrocarbon exploration company. With a strong chemicals segment that provides diversification and cash flow stability, OXY stock is really a play on the broader supply and demand fundamentals of the energy market.
Given ongoing geopolitical concerns, Occidental has turned out to be among the best market hedges. This company’s unique market positioning and lines of business have enticed some of the best investors. Indeed, when Buffett enters a position as aggressively as he has with OXY, you know this is a stock worth taking a look at.
With the company paying down nearly $5 billion in debt, Occidental is a company with a very attractive balance sheet and strong fundamentals to boot. Those looking for a winner from now to 2025 can’t go wrong with this multibagger opportunity.
Target Hospitality (TH)
Target Hospitality (NASDAQ:TH) is a specialty rental organization. This holding company focuses on mobile crew camps, workforce lodging, security, transportation and catering businesses. In other words, Target Hospitality focuses on providing workforce stability.
This company’s revenue guidance shot more than 50% higher this past quarter after the company announced a new government contract. Since this announcement, TH stock has soared more than 177%. This makes it one of the best-performing stocks in the market. Hey, it’s not even a meme stock.
On the contrary, Target Hospitality’s rise is due to fundamental forces alone. Accordingly, those looking for a true long-term beneficiary of a tight labor market may want to consider this stock right now. Like Occidental, I think Target Hospitality provides a unique market hedge during these uncertain times, complemented by long-term growth upside. Thus, there’s a lot to like about this name.
Multibagger High-Growth Stocks: Marathon Oil (MRO)
Marathon Oil (NYSE:MRO) is another top energy company worth considering. (Readers may catch my drift — I’m still bullish on oil, despite cooling commodity prices).
In the case of Marathon, there are many similarities to Occidental I think are worth considering. This company’s stable free cash flow generation, strong balance sheet and capital return to shareholders are key factors. Interestingly, Marathon has garnered interest as an ESG play, with its focus on governance and various environmental initiatives bringing praise.
Indeed, Marathon isn’t the oil company of the past. Rather, this company is moving into the future. It is focusing on providing strong capital returns to investors while inching toward sustainability for the future.
That said, it’s this company’s results and underlying fundamentals which are driving its outperformance. The company’s recent Q1 results, which saw it bring in net income of $1.78 per share, mean this stock is very cheap. At this run rate, Marathon is trading at around 5 times earnings. For those who are willing to apply a higher multiple to these strong earnings, it’s easy to come up with a scenario in which this stock is a multibagger opportunity in the next few years.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.