A stock grabs attention when it doubles in a year.
Yet, this creates a dilemma for both potential and current investors.
The former feel like they’ve missed out and may be hesitant to buy at high levels. The latter might sell and take profits, but risk forsaking future gains.
The answer depends not on price movements, but two connected factors – earnings and valuations.
Stock prices typically rise when investors expect future earnings to increase, either because revenue grows, or profit margins improve, or both. Investors expecting future earnings to rise may then revalue a stock, attaching a higher multiple to the same level of earnings.
One key question when analysing a stock that has doubled is whether the business has doubled as well; revenue and earnings growth justify the share price going up.
A second-order question is whether a company’s growth in earnings is sustainable.
Let’s see how these concepts apply to three US stocks that have doubled – or more – over the past year.
Micron (NASDAQ: MU) — The Earnings Explosion Story
As of 8 May, Micron’s share price had gone up by 729% from a year ago.
Demand for the memory and storage chips Micron manufactures has exploded, especially for high bandwidth memory (HBM) chips; HBM chips are combined with the graphics processing units (GPUs) designed by the likes of NVIDIA Corporation (NASDAQ: NVDA) and Advanced Micro Devices, Inc. (NASDAQ: AMD) to power AI data centres.
Micron has combined rapid revenue growth with strong operating leverage.
Its revenue for its fiscal year ended August 2025 (FY2025) was US$37.4 billion, up 49%.
This drove a massive increase in non-GAAP net income, which rose over 6x from US$1.5 billion to US$9.5 billion.
Investors may consider adding Micron to their watchlists if they believe this earnings momentum is sustainable; so far, this appears to be the case. Its gross margin for 2QFY2026 was 74%, double the 37% recorded in 2QFY2025.
Management expects the gross margin to rise even further to 81% in 3QFY2026.
It’s arguable that Micron’s stock still has room to grow. Micron’s current forward price-to-earnings (P/E) ratio at 7.6x is actually lower than the 9.0x seen a year ago.
However, investors should note that memory chip stocks are highly cyclical, and investors who bought in when earnings are rising have historically been burnt, even at a P/E ratio that looks inexpensive.
Optimists would respond that this time is different. South Korea’s SK Hynix Inc. (KRX: 000660), which along with Samsung Electronics Co., Ltd. (KRX: 005930) and Micron controls over 90% of the memory chip market, cited a “structural shift” which differentiates this boom from past ones.
At some point though, it will be hard to sustain this level of earnings growth, and so investors should closely monitor demand trends.
Haliburton (NYSE: HAL) — The Valuation Re-Rating Play
Haliburton provides products and services to the energy industry, helping customers – such as oil companies – maximise the value of their assets.
Over the past year the company’s shares have doubled. This is largely due to the market re-rating the stock: from a P/E ratio of 8.6x last June to 22x currently.
Investor sentiment around the company’s prospects has improved.
First, the US capture of Venezuelan President Maduro in January has renewed interest in the oil sector of the country, home to the world’s largest proven oil reserves. Haliburton recently revealed that it was “talking about commercial terms” with customers wishing to re-enter the market.
Second, the war in the Middle East has sent the price of oil soaring. This benefits Haliburton’s share price, which is strongly correlated with the price of oil.
However, this investor optimism has yet to show up in Haliburton’s financials.
Its revenue growth for 1Q2026 was flat, while net income of US$461 million was down from the adjusted net income of US$517 million in the year-ago period (the adjustments were to exclude impairments and other charges).
It will take some time for a revival of business in Venezuela and higher oil prices to be reflected in Haliburton’s numbers.
Investors would want to approach this stock with caution, since re-rating gains can reverse quickly if the underlying assumptions prove too optimistic.
Alphabet (NASDAQ: GOOG) — The Structural Growth Winner
Search giant Google’s parent company has gained 152% over the past year.
Alphabet’s businesses are well-placed to take advantage of structural megatrends, from AI to cloud computing. In 1Q2026, cloud revenue grew by 63% year on year, with a backlog of US$460 billion.
Its competitive advantage is that AI can enhance all seven of its products with two billion users each – Android, Chrome, Gmail, Maps, Play Store, Search, and YouTube.
Another future growth driver is the shift to autonomous vehicles, with Alphabet’s Waymo business valued at US$126 billion earlier this year.
Investors can consider Alphabet if they believe that it can continue growing its current businesses, as well as dominate new ones such as autonomous ride-hailing.
The company has continued to post strong numbers.
Revenue and operating income in 2025 were both 15% higher from 2024. Alphabet’s results for 1Q2026 were even better, as revenue growth was 22% while operating income growth was 30%.
Generally, the big tech companies that have dominated their sector tend to receive the lion’s share of the spoils, and have shown their ability to keep compounding value.
Get Smart: How to Approach Big Winners
Investors lucky enough to own a stock that has doubled should avoid making emotional decisions based on price alone.
Take a more analytic approach and assess if the original investment thesis still makes sense.
As a quick rule of thumb, consider two factors: management execution and growth potential.
If both remain at high levels, perhaps holding the position, or even adding more to the portfolio is the way to go.
Otherwise, consider trimming these holdings, rather than exiting completely. This allows investors to lock in some gains, while retaining exposure to further upside.
Ultimately, investing is forward-looking, and smart investors should focus on fundamentals, valuations, and long-term potential, not just how a stock has done in the past.
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Disclosure: Silas owns shares in Haliburton.
