Should You Forget KULR and Buy These 2 Millionaire-Maker Stocks Instead?

KULR Technology Group's (NYSEMKT: KULR) stock soared over 1,000% over the past two months. The energy solutions company impressed the market by gaining more commercial and government contracts. It also attracted more attention from crypto investors with its plans to build a "Bitcoin Treasury" by spending 90% of its surplus cash on Bitcoin.

KULR carved out a niche with its fiber-based heat management products for lithium-ion batteries, which were originally developed for NASA more than a decade ago. It now sells those products to a wide range of government, tech, and aerospace customers. Analysts expect its revenue to grow at a compound annual growth rate (CAGR) of 73% from 2023 to 2026.

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But with an enterprise value of $730 million, KULR now trades at 55 times next year's sales. That nosebleed valuation could set it up for a steep drawdown if the market crashes. So instead of chasing KULR, investors should consider buying these cheaper potential millionaire makers: Intuitive Machines (NASDAQ: LUNR) and Nio (NYSE: NIO).

An undervalued lunar exploration play

Intuitive Machines develops lunar exploration and landing vehicles for NASA. It signed three major contracts with NASA in 2021, and it originally planned to launch its first Nova-C lunar lander that same year. That closely watched project was repeatedly postponed, but NASA finally launched its lunar lander to the moon in February 2024.

That marked the first successful U.S. moon landing since 1972, and it convinced NASA to award the company a new lunar terrain vehicle (LTV) contract in April, a new commercial lunar payload services (CLPS) contract in August, and an exclusive near-space network (NSN) contract worth up to $4.8 billion in September. The company's quarterly backlog hit a record of $316 million at the end of the third quarter of 2024.

Intuitive expects its revenue to grow from $80 million in 2023 to between $215 million and $235 million in 2024 as it recognizes more revenue from its NASA contracts, gains more non-NASA contracts, and expands its lunar "ride-sharing" business for sending third-party payloads to the moon. From 2024 to 2026, analysts expect its revenue to more than double from $228 million to $497 million. It's still in the red, but analysts expect to turn profitable on a generally accepted accounting principles (GAAP) basis in 2026.

With an enterprise value of $1.5 billion, Intuitive Machines still looks reasonably valued at 4 times next year's sales. So if the lunar exploration race heats up again, it could be poised to generate multibagger gains over the next decade.

An underappreciated Chinese EV maker

Nio is a leading manufacturer of electric vehicles (EVs) in China. It produces a wide range of sedans and SUVs, but it differentiates itself from its competitors with its swappable batteries. These batteries can be quickly switched at its battery-swapping stations as a faster alternative to traditional chargers. It locks in those drivers with sticky subscriptions.

Nio's deliveries more than doubled in 2020 and 2021, but slowed to 34% growth in 2022 and 31% growth in 2023. That deceleration was caused by China's slowing economic growth, the cooling EV market, tough competition, and adverse weather conditions in certain regions. A price war also halved its vehicle margin from 20.2% in 2021 to 9.5% in 2023.

But for 2024, Nio expects its deliveries to rise 51% to 53% as it sells more premium ET-series sedans and cheaper Onvo smart vehicles in China. It also continues to expand in Europe even as it grapples with higher tariffs on Chinese EVs. From 2023 to 2026, analysts expect its revenue to grow at a CAGR of 29%. It's also expected to gradually narrow its GAAP losses with the support of government subsidies.

With an enterprise value of 64.8 billion yuan ($8.9 billion), Nio's stock looks like a bargain at a P/S ratio of less than 1. Its valuations could still be squeezed by concerns about higher tariffs and competitive threats in China, but it could generate millionaire-making gains if it successfully scales up its business.

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Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin. The Motley Fool has a disclosure policy.