3 Under-the-Radar Stocks With 340% to 762% Upside in 2024, According to Select Wall Street Analysts

3 Under-the-Radar Stocks With 340% to 762% Upside in 2024, According to Select Wall Street Analysts

Over the long run, Wall Street has proved to be a surefire wealth creator. But over shorter periods, the performance of the major stock indexes is unpredictable. Since this decade began, the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite have traded off bear and bull markets on a couple of occasions.

But no matter how well or poorly the broader market is performing, pockets of optimism can always be found. Whereas Wall Street has historically been bullish on time-tested and/or brand-name companies, it’s the lesser-known stocks that can sometimes offer truly jaw-dropping upside potential, according to analysts.

Based on the high-water price targets of select Wall Street analysts, three under-the-radar stocks offer upside ranging from 340% to 762% in 2024.

A white toy rocket readying for launch while atop messy stacks of coins and financial paperwork.
Image source: Getty Images.

Plug Power: Implied upside of 429%

The first off-the-radar stock that at least one Wall Street analyst believes could soar in the new year is hydrogen fuel cell and infrastructure company Plug Power (NASDAQ: PLUG). Analyst Amit Dayal of H.C. Wainwright holds a lofty $18 price target on Plug, which if accurate would imply a more than quintupling in its shares in 2024.

The allure of hydrogen stocks has to do with the desire of developed countries to minimize their respective carbon footprints. One of the easiest and most direct ways to combat climate change is to shift modes of transportation and infrastructure to various forms of clean(er) energy. Investors in Plug Power are certainly counting on hydrogen fuel-cell vehicles and green hydrogen infrastructure to play a key role in this transition.

Plug Power really made a name for itself three years ago when, in a span of just one week, it received an equity investment from SK Group and formed a joint venture with French automaker Renault. The former gave Plug an avenue to proliferate throughout Asia, while its joint venture with Renault is seeing the duo target Europe’s light commercial vehicle market.

Plug’s sales growth forecasts have also been strong. After generating around $500 million in total sales in 2021, management is forecasting a ramp-up to $20 billion in annual billings by 2030. This growth is dependent on the company opening a number of electrolytic liquid hydrogen production plants.

However, Plug Power’s finances are a big problem. Although the company appears close to securing a $1.6 billion loan from the U.S. Department of Energy (which would close during the third quarter), Plug has been operating under a going concern warning. Effectively, the company’s auditors don’t believe it has sufficient capital to cover its liabilities over the coming 12 months. That’s not something that can be swept under the rug.

Another issue for Plug Power is that its operating losses have ballooned in lockstep with its rising revenue. Although selling common stock has provided Plug with some much-needed capital, it’s been dilutive to the company’s existing shareholders.

Even with a key loan in place, Plug Power has yet to demonstrate that it has a viable and sustainable operating model.

Lexicon Pharmaceuticals: Implied upside of 340%

A second under-the-radar stock with seemingly otherworldly upside in 2024, based on the prognostication of one Wall Street analyst, is biotech company Lexicon Pharmaceuticals (NASDAQ: LXRX). If the top-tier $8 price target by Citigroup analyst Yigal Nochomovitz proves accurate, Lexicon shareholders would enjoy a 340% increase from where shares closed on Jan. 26.

The single biggest catalyst for Lexicon was the approval of once-daily oral heart failure drug Inpefa in May 2023 by the U.S. Food and Drug Administration (FDA). It’s the first drug Lexicon has had approved by FDA.

With the commercial launch of Inpefa just getting off the ground in 2023, the current year represents the first real revenue growth opportunity for the company. Wall Street estimates imply sales will climb by more than 1,100% in 2024 to $46 million. Peak sale estimates vary wildly, with most analysts expecting Lexicon’s top drug to eventually surpass $500 million in annual sales.

What makes Inpefa particularly intriguing is its mechanism of action: It’s an SGLT1 and SGLT2 inhibitor. While there are a handful of SGLT2 inhibitors on pharmacy shelves today — SGLT2 inhibitors work by blocking glucose absorption in the kidneys — Inpefa represents the first dual-inhibitor approval. SGLT1 helps block glucose absorption in the intestines. This approval opens the door for a potentially new class of drugs and makes Lexicon a pioneer.

At the same time, not all of Lexicon’s clinical trials have been successes. Sotagliflozin (the scientific name for Inpefa) failed in a type 1 diabetes trial that would, undoubtedly, have given the drug a considerably higher peak sales potential.

Furthermore, Lexicon Pharmaceuticals is losing money and has previously leaned on common stock issuances to raise capital (this is a common practice for clinical- and early-stage biotech companies). Though it was sitting on roughly $218 million in cash and investments at the end of September, it’s not yet clear how long it’ll take for Lexicon to reduce its operating losses and lessen its cash burn.

Even though Lexicon is a stock I believe could double in 2024, $8 per share is a long shot until there is evidence of improving operating performance and/or positive readouts from its other experimental candidates.

A physician administering a vaccine into the upper-right arm of a patient.
Image source: Getty Images.

Novavax: Implied upside of 762%

The third under-the-radar stock with sensational upside in 2024, based on the forecast of one Wall Street analyst, is biotech stock Novavax (NASDAQ: NVAX). According to Vernon Bernardino of H.C. Wainwright, this beaten-down biotech can reach $35 per share, which represents scorching-hot upside of 762%, based on where shares closed on Jan. 26.

Novavax is perhaps best known as being one of the few companies to successfully develop a COVID-19 vaccine. The Novavax COVID-19 vaccine is protein-based, which means it teaches your body how to recognize and fight back against the SARS-CoV-2 virus that causes COVID-19.

Although it was thought that Novavax bringing a vaccine to market that worked via traditional mechanisms would appeal to consumers, the company had a number of miscues along the way. Delays in filing for Emergency Use Authorization in key markets, coupled with manufacturing delays, allowed Novavax’s rivals to effectively steal all the low-hanging fruit. With the worst of the pandemic now over, COVID-19 vaccines sales have tapered significantly.

In 2024, cost-cutting is going to be a big focus for Novavax. Through the first nine months of 2023, Novavax had trimmed its operating expenses by 47%, or $950 million, from the comparable period in 2022. Management is aiming to lower operating expenses by over $300 million in the current year as well.

Another potential catalyst for the company is pending arbitration with Gavi, a nongovernmental worldwide vaccine organization. Gavi is seeking $700 million following the cancellation of a contract with Novavax regarding its COVID-19 vaccine. If Gavi is owed $700 million, there’s no guarantee Novavax has the capital to keep the lights on. Meanwhile, a favorable ruling for Novavax could send shares notably higher and remove any near-term funding concerns.

The final factor that could make a difference in 2024 for Novavax is the start of a COVID-19 and influenza combination vaccine trial that’s expected to kick off in the second half of 2024. Though a combination vaccine wouldn’t launch until 2026, at the earliest, Novavax merely demonstrating that it can stay on track might be enough to fill the proverbial sails.

While I remain optimistic that Novavax can turn things around, a $35 price target seems a bit overzealous given the company’s current unknowns.

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Citigroup is an advertising partner of The Ascent, a Motley Fool company. Sean Williams has positions in Novavax. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

3 Under-the-Radar Stocks With 340% to 762% Upside in 2024, According to Select Wall Street Analysts was originally published by The Motley Fool