Investing in growing companies with near-term catalysts for growth can put you on track to earn excellent returns. If you have some extra cash after paying off expenses or debt, here are two exciting stocks you can buy today that could soar in 2025 and beyond.
1. Tesla
Tesla (TSLA 2.60%) overcame the odds to take on the leading car manufacturers over the last decade. The stock delivered staggering returns, but its recent underperformance relative to the market averages could set the stage for another bull run. While Tesla struggles to grow automotive revenue amid higher interest rates, the most important metric signaling a great future for the company is improving margins.
Tesla's cost of goods sold per vehicle was approximately $35,100 in Q3 -- the company's lowest ever. The further Tesla drives costs down, the cheaper it can sell vehicles, and widen its customer base.
NASDAQ: TSLA
Key Data Points
The stock price is up since its latest earnings report, in part, because of Tesla's margin performance. Despite automotive revenue up only 2% year over year, operating income increased by 54% year over year to $2.7 billion. The company credited several items for the increase, including higher revenue from full self-driving (FSD) features related to Cybertruck, growth in vehicle deliveries, growth in its energy business, and lower cost per vehicle.
Tesla's auto business could be on the verge of a rebound in 2025. The consensus analyst estimate has the company growing revenue by 15% to $114 billion next year. Tesla is planning to launch more affordable models next year, and then as early as 2026, the company is planning to ramp up production of Cybercab, which will open the door to a robotaxi service that could further boost its profit margin over the long term.
The stock looks expensive, trading at a forward price-to-earnings (P/E) ratio of 82 on 2025 earnings estimates, but this reflects the expectation for improving margins and strong earnings growth in the coming years. Analysts expect earnings to increase by 31% in 2025. If the company meets those expectations, Tesla investors should see the share price break out of its recent slump.
2. Nvidia
Nvidia (NVDA +0.64%) is another growth stock that could be a timely buy heading into 2025. Nvidia's innovation allowed it to essentially corner the market for AI chips, or graphics processing units (GPUs). The demands that artificial intelligence (AI) training puts on data processing will require data centers to continue investing in more chips over the long term, which could fuel Nvidia shares higher.
NASDAQ: NVDA
Key Data Points
Nvidia's GPUs are used for gaming, professional graphics applications, and self-driving cars, but the data center business makes up 87% of total revenue. The company's revenue more than doubled in Q2 over the year-ago quarter, driven by strong demand in the data center market.
Dell'Oro Group forecasts data center spending to increase at a compound annual rate of 24% through 2028, driven by AI-related infrastructure, which includes GPUs. Nvidia has important relationships with the leading cloud service providers and AI researchers. There are over 4 million developers that use Nvidia's CUDA programming model, but the most important factor that will continue to drive growth for Nvidia is innovation.
Nvidia's upcoming Blackwell computing platform uses multiple chips, including GPUs, central processing units (CPUs), and data processing units (DPUs), that all combine to perform like a single superchip. It can deliver up to 30 times faster AI inference performance, which is how a chatbot like ChatGPT learns to quickly process a question and spit back a human-like response.
The company says that demand for Blackwell is already above supply, which points to strong margin performance and earnings growth. Analysts expect Nvidia's revenue and earnings to grow 42% next year. That is enough growth to support the stock's forward P/E of 35 on 2025 earnings estimates. The stock may not double again next year like it did this past year, but a return that follows the company's earnings growth is certainly possible, which would put the share price close to $200 in roughly one year.
