Upstart, RH, and Sweetgreen: The 10x Candidates
Yahoo Finance identifies three undervalued companies with strong potential for 900% gains over the next decade based on current fundamentals.
Key points
- Upstart projects 35% revenue growth through 2028 and trades at a 13x P/E ratio after a 90% price drop.
- RH targets 5.5%-7% revenue growth in 2026 with a 15%-16.2% EBITDA margin despite a stalled housing market.
- Sweetgreen has struggled with profitability and sold its Infinite Kitchen technology, yet remains the top salad chain.
Yahoo Finance highlights three publicly traded companies that possess the potential to multiply their value tenfold over the next decade. The analysis focuses on businesses that are currently trading at significant discounts to their historical highs while maintaining strong fundamental growth trajectories.
The selection includes Upstart, RH, and Sweetgreen, each of which has faced recent headwinds but retains specific structural advantages. These firms are positioned to capitalize on macroeconomic shifts and operational improvements, offering a compelling case for long-term investors seeking high-return opportunities.
Upstart Shows Strong Valuation Metrics
Upstart (NASDAQ:UPST) has fallen 90% from its peak, creating a significant entry point for investors. The AI-driven loan originator is now profitable on a GAAP basis and projects 35% revenue growth through 2028. With a market cap of just $2.4 billion, the company is trading at a price-to-earnings ratio of approximately 13, suggesting substantial undervaluation.
The firm is expanding into home and auto loan markets, broadening its addressable market. Additionally, Upstart is in the process of securing a bank charter, a move that will lower operational costs and facilitate nationwide product launches. This strategic positioning places the company in a stronger competitive stance than in previous years.
RH Targets Luxury Market Expansion
RH (NYSE:RH), formerly Restoration Hardware, has dropped more than 80% from its high due to a stalled housing market. Despite this, the company targets 5.5% to 7% revenue growth in 2026, with an adjusted EBITDA margin of 15% to 16.2%. At a $2.4 billion market cap, the stock is priced for a significant turnaround.
The company has expanded its brand into Europe and diversified into guesthouses and yacht charters. CEO Gary Friedman has successfully implemented a membership model, establishing RH as a premium luxury retailer. A recovery in the housing market could trigger a sharp rebound in demand and profitability for the firm.
Sweetgreen Faces Operational Challenges
Sweetgreen (NYSE:SG) has struggled since its 2021 IPO, failing to consistently turn a profit. The fast-casual chain has faced customer backlash over high prices and recently sold its Infinite Kitchen technology to Wonder, retaining usage rights. These operational setbacks have dampened investor confidence in the company's growth narrative.
Despite these issues, Sweetgreen remains the leading player in the salad chain segment. The company's inclusion in this list suggests that its current low valuation may not fully reflect its long-term potential. However, it must resolve profitability concerns and address public health incidents to realize its projected returns.
