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2 Top Growth Stocks That Could Easily Double
DOCNDigitalOcean(DOCN) The Motley Fool·2025-01-26 14:20

Group 1: DigitalOcean - DigitalOcean is focusing on artificial intelligence (AI) to drive growth after experiencing sluggish revenue growth in recent years [1][2] - The company acquired AI platform Paperspace in 2023 and launched virtual servers with GPUs, enhancing its AI compute capacity [6] - DigitalOcean's total addressable market is projected to exceed 200billionby2027,withestimatedrevenueofaround200 billion by 2027, with estimated revenue of around 775 million for 2024 [7][8] - The stock is valued at less than 4billionandtradesatapproximately23timestheaverageanalystestimatefor2024earnings[7]Group2:PubMatic−PubMaticspecializesinprogrammaticdigitaladvertising,helpingclientsmaximizerevenuethroughitsplatform[10]−Thecompanyfacedaslowdowningrowthin2023,withrevenueincreasingbyonly44 billion and trades at approximately 23 times the average analyst estimate for 2024 earnings [7] Group 2: PubMatic - PubMatic specializes in programmatic digital advertising, helping clients maximize revenue through its platform [10] - The company faced a slowdown in growth in 2023, with revenue increasing by only 4%, but has since rebounded with a 13% year-over-year growth in Q3 2024 [11] - Connected TV (CTV) is a significant growth area for PubMatic, with CTV impressions more than doubling year-over-year [11] - PubMatic operates its own infrastructure, allowing efficient processing of 1.8 trillion advertiser bids daily, and recorded free cash flow of 26 million in the first nine months of 2024 [12] - The stock trades at about 20 times the average analyst estimate from adjusted earnings per share, with a market capitalization of approximately $716 million [12]