5 Incredible Growth Stocks to Buy for 2025

Although Nu stock had been soaring for a long time, it has taken a step back recently due to investors’ worries about prolonged inflation and economic volatility in Brazil. That’s justifiable: Nu’s results have been impacted by conditions there in several ways, including net interest margin compression and slower growth in average revenue per active customer.

But these are short-term concerns, and Nu could bounce back in 2025 and be a top stock to own long term. Nu stock trades at a forward P/E ratio of less than 20, which is a bargain.

Lemonade (NYSE: LMND) went from market darling to a stock that investors loved to hate. But lately, it has earned its way back into the market’s good graces again by demonstrating robust growth and an improving loss ratio.

In-force premiums — the typical top-line metric for insurance companies — increased by 24% year over year in the third quarter, while customer count rose 17% to 2.3 million, and premium per customer increased by 6%. Investors have been waiting for the company’s loss ratio to get better, and it did, falling 10 percentage points year over year, a notable accomplishment. Lemonade is still reporting net losses, but as its loss ratio declines and profitability improves, the stock should keep rising.

Investors might be hesitant to buy a stock that’s already up 191% this year, but Lemonade came into 2024 more than 90% off of its highs, so there’s lots of room for further gains. Lemonade is just starting its journey, and it has a technological edge over legacy insurers. The stock could continue to rise in 2025, and it could be a phenomenal investment over the next few years.

Lemonade stock trades at a price-to-sales ratio of 6.7, which isn’t unreasonable for its potential.

E.l.f. Beauty (NYSE: ELF) might be probably the fastest-growing cosmetics company today. It’s capturing market share in the makeup and skincare markets, and generating loyalty and sales for its low-priced but trendy products.

Sales increased 40% year over year in the third quarter. That’s impressive on its own, but more so considering that it achieved that at a time when many industry veterans are struggling. Shoppers generally are reducing extraneous purchases, and if they do need cosmetics, many are switching down to more affordable alternatives.

E.l.f. is reporting high growth, and it’s also profitable. Net income has been muted as the company works to get the word out about its products amid a challenging environment, but it’s still positive.

E.l.f. is building its brand and developing strong relationships with its customers. It has a wide opportunity as it challenges the leaders in every category, and 2025 could be a big rebound year. The stock trades at a reasonable 32 times forward 1-year earnings.

Revolve Group (NYSE: RVLV) isn’t a well-known company outside of the fashion world — yet. But it’s capturing market share from the apparel leaders, and it’s getting back to growth after a few quarters of struggling through inflation. Sales increased 10% in the third quarter, and net income soared by 238%.

The business all online, and it uses artificial intelligence throughout its organization. It works with social media influencers and celebrities to market its high fashion items to devoted customers, and it has continued to recruit new active customers despite a tough environment for consumer discretionary companies.

Revolve stock is rebounding after a tough year, and it’s well-positioned to keep up its rise in 2025 and beyond. It trades at a cheap price-to-sales ratio of 2.4.

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

• Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $350,239!*

• Apple: if you invested $1,000 when we doubled down in 2008, you’d have $46,923!*

• Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $492,562!*

Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.

See 3 “Double Down” stocks »

*Stock Advisor returns as of December 9, 2024

Jennifer Saibil has positions in Lemonade, Nu Holdings, and SoFi Technologies. The Motley Fool has positions in and recommends Lemonade, Revolve Group, and e.l.f. Beauty. The Motley Fool recommends Nu Holdings. The Motley Fool has a disclosure policy.

5 Incredible Growth Stocks to Buy for 2025 was originally published by The Motley Fool