The Motley Fool·2025-12-21 20:40Core Insights - A group of five growth stocks is highlighted as potential multibaggers for long-term investors, despite recent declines of 22% to 55% from their 52-week highs [1][2] Group 1: Rocket Lab USA - Rocket Lab USA has seen its sales increase nearly tenfold since its IPO in 2021, positioning it as the No. 3 player in the launch services industry [4][5] - The company is expected to launch its Neutron rocket in Q1 next year, which could enhance its competitive stance against larger peers like SpaceX [4] - The space industry is projected to grow from $630 billion in 2023 to $1.8 trillion by 2035, indicating significant growth potential for Rocket Lab, which has a current market cap of $28 billion [7] - Rocket Lab's gross margin stands at 28.93%, and shares are currently 20% below their high, making it an attractive investment opportunity [9] Group 2: Kinsale Capital - Kinsale Capital Group has delivered a 39% total return since its 2016 IPO, with a combined ratio of 77%, outperforming peers with an average of 92% [10][11] - The company focuses on small, hard-to-assess risks, which has allowed it to carve out a profitable niche, although its revenue growth slowed to 19% in the latest quarter due to increased pricing competition [12] - Kinsale's stock is down 24% due to this growth slowdown, presenting a potential buying opportunity [13] Group 3: MercadoLibre - MercadoLibre has transformed from $85 million in sales at its 2007 IPO to $26 billion today, making it a 70-bagger [14] - The company operates in a market where online buying penetration in Latin America is only half that of the U.S., indicating further growth potential [15] - MercadoLibre's logistics network supports its e-commerce and fintech operations, and the stock has dipped 23% from its July 2025 highs, making it a favorable buy [16] Group 4: SPS Commerce - SPS Commerce has delivered 18% annualized returns since 2010, with sales growing 26 times in value during that period [17] - The company has achieved 99 consecutive quarters of positive sales growth, although its growth rate has decelerated, leading to a 55% drop in stock price over the last year [18] Group 5: Dutch Bros - Dutch Bros has seen a 14% annual stock price increase since 2021 and aims to expand from 1,089 locations to 2,029 by 2029 [20] - The company plans to buy back shares using at least half of its free cash flow, marking a shift from previous reliance on issuing new shares [21][22] - Despite trading at 40 times cash from operations, the growth potential could make it a multibagger if expansion goals are met [23]