1 Growth Stock That Could Produce 10X Returns

Growth stocks tend to be volatile investments, and the market often overreacts to both their good and bad news. On the bright side, that occasionally creates buying opportunities for long-term investors. By thinking in terms of years rather than days, you can look past the near-term headwinds and focus on the big picture.

For instance, the share price of Coupa Software (NASDAQ:COUP) has fallen nearly 35% from its 52-week high, fueled in part by a broader rotation away from growth stocks. However, that doesn’t mean the tech company has altogether lost its strong competitive position and big market opportunity. Here’s how this exciting stock could grow tenfold in the next decade.

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A strong competitive position

Coupa specializes in business spend management (BSM). Its software platform connects clients (i.e. buyers) with over seven million suppliers, helping them control spend, optimize supply chains, and realize cost savings. In a general sense, Coupa is both an e-commerce marketplace and an expense management tool for businesses, designed to simplify traditional procurement and enterprise resource planning solutions.

Coupa’s scale is one of its greatest assets. Over 2,000 businesses rely on its BSM platform, and Coupa enables these clients to pool their collective buying power through group sourcing events. This helps clients achieve better prices than they could get alone. Coupa also offers a range of pre-negotiated discounts across categories like office supplies and promotional products, creating instant value for clients.

Since its founding, Coupa’s platform has powered $2.8 trillion in business spend, creating troves of transaction data in the process. To that end, Coupa leans on artificial intelligence to surface suggestions, including cost savings opportunities and supply chain risk management strategies. This capability sets Coupa apart from its rivals, as its platform is the only BSM suite that offers real-time prescriptive insights.

Broadly speaking, this creates a network effect. Each customer adds to the collective buying power of the Coupa community, and each transaction generates more data for its AI models. In both cases, this enhances the value proposition for every customer, driving greater costs savings through group sourcing events and more intelligent recommendations.

Given its strong competitive position, research company Gartner has recognized Coupa as the leading provider of procure-to-pay software for the last five consecutive years. In the most recent report, Gartner specifically cites the platform’s deeply integrated payment capabilities, robust network of suppliers, and AI-powered prescriptive insights as key differentiators.

Not surprisingly, that value proposition has helped Coupa deliver strong growth over the last three years.