Cathie Wood has been with her company’s flagship fund, the ARK innovation ETF (NYSEMKT: ARKK), increased 149% in 2020. Companies it invests in, such as streaming platforms year, Fintech pioneer squareand communication service Zooming, benefited greatly from the effects of the pandemic on consumer behavior.
But there’s one unstoppable stock that has far outperformed the ARK Innovation ETF in the past 12 months, and it’s a company you’ve probably never heard of. Read on to find out more about it fast growing business.
No pain no gain
With a Market capitalization of $ 1.4 billion, The common corp. (NASDAQ: JYNT) is a Small cap stocks that skyrocketed 419% last year. Unsurprisingly, a company this size is flying under the radar, but its execution so far deserves a lot more attention.
The Joint Corp. is a franchisor and operator of low-cost, privately-paid (no insurance required) chiropractic clinics in the United States. As of June 30, there were 633 locations nationwide, 282 of which were under development. Annual back pain spending averages $ 90 billion, so The Joint Corp.’s system-wide revenue 2020 offers a huge untapped growth opportunity of $ 260 million.
The value proposition for patients is amazingly clear. For an average of $ 29, customers can get a basic spine fit performed by a licensed chiropractor with no need to make an appointment. The company treated 1.1 million individual patients in 2020, 10% more than the previous year. And the fact that 50% of Americans don’t even know what the word “chiropractic” means supports The Joint Corp.’s mission to make chiropractic treatment more convenient.
The industry is dominated by around 40,000 independent chiropractic offices, which generate 97% of the total sales in the market. The Joint Corp. currently owns a tiny 1% market share, but management has big ambitions. 1,000 clinics are expected to be open by the end of 2023. And the long-term potential of 1,800 locations in the USA alone is even more exciting. That would be almost three times the number of branches today.
The stock is currently trading at a steep price-to-earnings-ratio of 240, so I recommend it wait for a pullback before you decide to buy stocks.
You can beat the pros
While it may be tempting to mimic the investment decisions of those who you hear about or who you see on the news, this is not always the best idea. For starters, if you haven’t researched the specific stock yourself, it’s less likely that you will be able to hold it for the long term. This is especially important during the inevitable ups and downs when you need conviction to stick with your plan.
The Joint Corp. can teach us an important lesson that individual investors can beat the experts. Compared to large institutions with billions of dollars under management, retail investors can buy shares in much smaller companies. Not only that, you could have discovered it too The common corp. as a customer, just like me.
To be a good investor means to be genuinely curious about the world around you. If you see new and unfamiliar companies in your daily life that pique your interest, chances are they will be publicly traded. And that down-to-earth research gives you firsthand access to potentially lucrative investment ideas, something that can put people like Cathie Wood at an advantage.
Maintain this mentality as you expand your skills and become a better and more experienced investor. You might find another standout stock like The Joint Corp.
This article represents the opinion of the author who may disagree with the “official” referral position of a premium advisory service from the Motley Fool. We are colorful! Questioning an investment thesis – even one of our own – helps us all think critically about investing and make decisions that will help us get smarter, happier, and richer.