Title: Top 10 Investment Opportunities in 2025: Are They Worth Your Dime, Given Their 48% Market Beating Performance in 2024?
In early 2023, I shared my picks for the 10 best stocks to invest in for the year, boasting a 74% return on investment compared to the S&P 500. Fast forward to December 2024, and my latest list of top 10 stocks for 2025 has yielded an impressive 48% excess return over the index.
Let's examine how my handpicked stocks have fared with the market nearing the 2025 end, and if they're worthy contenders for your upcoming investments:
Drumroll, please...
- Airbnb (ABNB -0.37%): After climbing 59% in 2023, Airbnb has been relatively stable this year, despite its significant growth and heightened profitability. This appears to be a value stock, currently trading at 22 times its trailing 12-month free cash flow, making it an appealing option for value investors.
- Amazon (AMZN 0.01%): Powered by the success of its artificial intelligence (AI) capabilities within cloud computing (AWS), Amazon has witnessed a remarkable 45% increase. Its dominance as the largest e-commerce company in the US and its AI-driven cloud services have positioned Amazon as a top investment choice for most investors.
- Costco Wholesale (COST 0.65%): Consistently delivering strong performance, Costco is a trusted all-weather stock and a favorite among value investors. When market conditions are uncertain, Costco's reliability and appraisal by the market make it a compelling buy for those investing with long-term goals in mind.
- Global-e Online (GLBE 0.44%): This small but potent e-commerce powerhouse has grown steadily, providing cross-border services for leading online retailers such as Disney, LVMH, and Nordstrom. It also adds more clients every quarter, positions itself closer to profitability, and shows signs of expanding its momentum into 2025.
- Lemonade (LMND -4.70%): This insurance innovator has had a remarkable comeback in 2024, rebounding from more than a 90% drop at its peak. Its AI algorithm's impact has reshaped the insurance landscape and opens a tremendous opportunity for further growth.
- Lululemon Athletica (LULU -0.14%): Struggling with product missteps and a soft market for premium apparel, Lululemon has faced challenges this year. However, its currently discounted valuation at 26 times its trailing-12-month earnings presents an attractive opportunity for long-term investors.
- MercadoLibre (MELI -1.82%): This long-term performer, MercadoLibre, experienced a downturn early in the year due to economic instability and growing competition. However, its exceptional business and high-profitability continue, promising strong growth prospects in Latin American markets.
- Nu Holdings (NU -0.18%): This all-digital Brazilian bank has been booming, and its cross-selling strategy has significantly increased consumer engagement and average revenue per active customer. With over 110 million global clients and its expansion into new markets, Nu Holdings looks poised for continued growth in 2025 and beyond.
- SoFi Technologies (SOFI -2.41%): The expansion of SoFi's all-digital bank in the US has led to impressive momentum and profits. Positive net income in the past four quarters and continued market share gains suggest SoFi is well on its way to long-term sustainability.
- Visa (V 0.30%): Visa continues to be an all-weather stock, generally performing well in both up and down markets. Although underperforming the broader market this year, Visa's long-term growth legacy and overall value position it as a strong buy for investors.
Final Thoughts
To achieve a truly diversified portfolio, a mix of these top picks and additional investments may be in order. Investors should remember that yearly performance can fluctuate, but a focus on selecting high-quality stocks and maintaining a long-term horizon increases the likelihood of building steadily growing wealth in the stock market.
In light of the impressive returns from my previous stock selections, I encourage investors to consider these handpicked stocks for their upcoming investments. For instance, SoFi Technologies, with positive net income in the past four quarters, showcases strong growth potential. Similarly, Nu Holdings, a digital Brazilian bank, has seen significant engagement and revenue growth, positioning it for continued growth in the future.
By diversifying your portfolio with these high-quality stocks and maintaining a long-term investment strategy, you increase the likelihood of building steadily growing wealth in the ever-changing stock market.
