It's time for my annual list of 10 top stocks to buy for the new year. It's not so different than last year's list, so you won't be too surprised to see most of the picks. I swapped out only four, and that goes along with my buy-and-hold investing philosophy. I'm not looking for trendy new stocks; I'm looking for stability with strong growth potential.
My picks over the past two years have beaten the market, and I'm hopeful that I'll continue that track record into 2025.
Without further ado, I present this year's list, with a little snippet about why I'm choosing each one. But every investor should do their due diligence and make sure they fully understand each stock and its investing thesis before buying.
Amazon (NASDAQ: AMZN) is a no-brainer stock for almost any portfolio, and even though it's already the second-largest company in the U.S. by sales, it has so much more potential. It represents about 37% of all U.S. e-commerce and has 33% of the global cloud computing market, both of which make it unstoppable. But its generative artificial intelligence (AI) business is driving growth right now, and it makes it a compelling option for 2025 and beyond.
Sadly, I removed American Express (NYSE: AXP) from my list last year and lost out on its incredible gains in 2024. Well, I'm putting it back on. American Express has been demonstrating incredible resilience despite macroeconomic uncertainty, and it's made itself relevant to a new, young clientele that will drive growth as it grows along with the company. It has a fee-based structure that feeds the bottom line, and it should enjoy tailwinds as interest rates come down.
Carnival (NYSE: CCL)(NYSE: CUK) has made an incredible rebound from pandemic lows, but the stock remains 51% off of its all-time highs. As it continues to report record results throughout its operations, it's likely to get back up there. One of the reasons the stock is still cheap is that it has a huge debt hanging over it, but it's well-positioned to pay it off at a faster rate with declining interest rates. With demand at all-time highs, profitability returning, and lower interest rates, 2025 could be a banner year for the cruise leader.
Dutch Bros (NYSE: BROS) is another stock I took off of last year's list and missed out on in 2024. I was concerned about macro headwinds with inflation, but Dutch Bros has proven to be more resilient than I thought, even at this young stage. That gives me even more confidence in how it can perform in 2024 and long term. It is reporting improving profits with positive net income for several quarters while still demonstrating phenomenal growth, and it has a giant future opportunity.
Global-e (NASDAQ: GLBE) provides cross-border e-commerce solutions for A-list clients, and as e-commerce keeps growing and the world becomes smaller, its services will continue to be in strong demand. It has a long pipeline of clients, and lower inflation should be a healthy tailwind. Global-e is moving closer to profitability, and it expects to become net income positive in 2025, setting itself up for an excellent year.
Lemonade (NYSE: LMND), an insurance technology company, is making my list look good in 2024, bringing up the whole with a 176% gain. I debated putting it on the list again, because can we expect a repeat? If its loss ratio doesn't keep up with this year's improvements in 2025, it's likely to sink again. But I believe in its long-term potential, and if it does keep up its strong performance, the stock price should reflect it again in 2025.
MercadoLibre (NASDAQ: MELI) is a top stock that presents incredible growth opportunities for the long-term investor. It reports consistent strong growth in both its e-commerce and fintech units, and its population is still underpenetrated. Even though it's almost as old as Amazon, its population is still in the adopting-digital phase. MercadoLibre stock has already created fabulous gains for shareholders, but it's down over the past three months, which is an opportunity for new investors to buy on the dip.
Nu Holdings (NYSE: NU) is a Brazil-based digital bank that's disrupting traditional banking in Latin America and growing like a weed. It has been profitable for several quarters, and it has a robust credit business. Customer count continues to climb, faster in its newer markets of Mexico and Colombia, but at a solid pace even in Brazil, where 56% of the adult population is already on the platform. These are highly engaged members, and there's tremendous opportunity as Nu consistently reports high growth and increasing profits.
If you follow sneaker trends, you've already noticed On Holding's (NYSE: ONON) distinctive athletic footwear. Customers are crazy about it, and sales have been soaring for a while. On is relatively young, and it hasn't reported many profitable quarters yet, but it's moving in that direction. It already has the best gross margins in the industry, and as it scales, high revenue is covering marketing expenses. Expect a lot from On as it rolls out in more global regions and generates consumer loyalty.
SoFi Technologies (NASDAQ: SOFI) is finally capturing the market's attention again. It's an all-digital bank offering a large suite of financial services on its app, and it has attracted millions of new members over the past few years. Its core lending business is improving as interest rates go lower, and its nonlending segments continue to grow and create value for the company. SoFi stock is just rebounding after a tough year, and 2025 could be a standout year for this growth stock.
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*Stock Advisor returns as of December 9, 2024
John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. American Express is an advertising partner of Motley Fool Money. Jennifer Saibil has positions in American Express, Global-E Online, Lemonade, MercadoLibre, Nu Holdings, and SoFi Technologies. The Motley Fool has positions in and recommends Amazon, Global-E Online, Lemonade, and MercadoLibre. The Motley Fool recommends Carnival Corp., Dutch Bros, Nu Holdings, and On Holding. The Motley Fool has a disclosure policy.