HOLY GRAIL: Investing in a stock that multiplies its share price by a factor of ten is the elusive holy grail for many investors. Our analysis shows such ten-baggers are very rare. They make up only 2.7% on average of the sixteen developed markets indices we looked at over the past ten years. It helps to start as a tech-sector midcap, with strong sales growth. This then leads to rising profit margins and a valuation rerating from investors. Whilst the tech and NVIDIA-led US ranks very well (see chart), its surprisingly Australia’s miners that dominate, followed by Sweden and Germany. Whilst Korean chemicals (Kumyang) to Japanese semis equipment (Lasertec) have done even better than the US AI-chips giant, in a timely reminder of global opportunities.
USA: Twenty-three stocks in the current S&P 500 index have been ten-baggers over the past decade. This represents 4.6% of the current constituents. And is the fourth highest proportion of the global stock indices we analyzed. It’s led by a top five of NVIDIA (share price up 118x in ten years), AMD (32x), Tesla (27x), Broadcom (20x), Cadence Design (20x). Tech dominates the list, making up 65% of the ten-bagger constituents. With the rest comprising healthcare (MOH, LLY, DXCM), transport (ODFL, CPRT), financials (MSCI, FICO), and renewables (ENPH).
WORLD: Australia dominates with 8.9% of its largest stocks ten-baggers over the past decade. This is near double the next highest market. It’s led by lithium stocks Pilbara (320x) and Liontown (135x), with miners making up 65% of the list. Sweden follows, led by tech Fortknox (60x) and defense Invisio (39x). Then Germany with biofuel Verbio (19x) and construction software Nemetschek (18x). At the other extreme, Italy has none and UK only Games Workshop (14x) and JD Sport (10x). With France only Sartorius Biotech (9x) and Esker (10x) software.
All data, figures & charts are valid as of 04/12/2023.