Morgan Stanley predicts a triple-digit rally for these 3 stocks
Wall Street is known for its efforts to predict the future development of stocks and predict where their prices may go. These predictions are often based on educated guesses that are based on information and models that are not available to ordinary investors.
Analysts' stock price targets are usually short-term. They usually focus on a period of around 12 months. Investors should not follow these views too closely as share prices can be very volatile over such a short period. The ideal is to own shares for at least three to five years, but preferably even longer.
However, when analysts predict that high-growth stocks can double in value within a year, it is worth taking note. Even if they're wrong by half, it could still yield significant gains.
Below are three high-growth stocks that Morgan Stanley analysts expect to rise 100% over the next year.
Li Auto $LI-2.9%
Li Auto Inc.
LIChinese electric vehicle maker Li Auto is the first of the high-growth stocks that more than one analyst expects to double in value. Morgan Stanley analyst Tim Hsiao has set a target price of $53 per share, though his initial estimate was $65 per share.
LI shares are down 44% in 2024, due to the slowdown in the electric vehicle market, which has also hit Chinese automakers. Still, June deliveries surprised the market with their strength. The second quarter delivered much better than expected results.
Li Auto delivered 47,774 vehicles in June, up 47% from last year and slightly above expectations of 47,000 vehicles. The company also reported that it sold 108,600 electric vehicles in the second quarter, better than the midpoint of the range of 105,000 to 110,000 vehicles it provided in May.
Silence Therapeutics $SLN-1.1%
British biotechnology company Silence Therapeutics is a second high-growth stock with triple-digit percentage growth potential. Morgan Stanley analyst Michael Ulz rates the stock a "buy" and raised his target price from $45 to $49 per share last month, suggesting growth of over 120%.
Silence Therapeutics wants to use precisely designed drugs using RNA interference (RNAi). This is the body's natural mechanism to "silence" the expression of disease-causing genes. Their lead drug candidate is zerlasiran (SLN360), which is currently in Phase 2 clinical trials. Recently, Silence Therapeutics announced positive results from a 48-week study involving 178 patients with high lipoprotein(a) levels, indicating a high risk of atherosclerotic cardiovascular disease.
The biotech company's shares have risen 13% this year and have tripled in the past 12 months. In February, the company received a $10 million milestone payment from AstraZeneca, with which it is collaborating on various cardiovascular, renal and metabolic diseases. Under the collaboration, the company can pursue 10 targets. Silence Therapeutics is eligible for up to $140 million in development milestone payments and up to $250 million in commercialization milestone payments. It will also receive tiered royalties on net sales as they occur.
Viking Therapeutics $VKTX-2.3%
Another biotech company with high growth potential is Viking Therapeutics. The company has made a name for itself in the obesity drug market, popularized by Novo Nordisk's Ozempic and Wegovy and Eli Lilly's Monjouro and Zepbound.
Viking is trying to blaze a new trail by developing treatments in pill form. Because competition requires regular injections, pills are a less optimal treatment for diabetes and obesity. Weight loss in a pill is something of a Holy Grail in public acceptance, and a GLP-1 treatment called VK2735 could open up a huge opportunity.
Analyst Ulz also covers Viking and has set a price target of $105 per share, suggesting more than 120% upside for VKTX stock.
Shares are down more than 25% from the highs they reached after the early positive results of VK2735, but still remain 253% higher in 2024 and are more than 350% above where the stock stood a year ago.
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