Growth stocks can help you achieve financial success over many years. Even the best stocks can fall in the short term, but it's the long-term growth of the underlying business that creates lasting value for shareholders. To help you in your search for such stocks, here are two that offer attractive upside potential for 2025 and beyond.
1. Uber Technologies
Uber Technologies (UBER +0.84%) stock has had a great run over the past few years, but there is still a huge opportunity ahead in a ride-hailing market projected to surpass $200 billion by 2029, according to Statista.
Uber continues to grow at double-digit rates that can support excellent returns for investors. In the fourth quarter, revenue grew 18% year over year. Uber is benefiting from millions of people engaged with driving, delivery, and shopping services, which creates a lot of opportunities for the company to complete trips and make money from service fees.
NYSE: UBER
Key Data Points
The ride-hailing leader still has substantial opportunities to grow the platform through geographic expansion, membership, and investing in autonomous vehicles.
Uber One has 30 million members, up almost 60% year over year. It is also launching autonomous service in Austin, Texas, next month in partnership with Alphabet's Waymo, and it already has plans to expand this service to Atlanta.
Moreover, as Uber expands and achieves greater scale, it is seeing significant improvements in profitability. Operating income nearly doubled last year to $4.1 billion. Management has attributed higher margins to more people using the service more frequently, which helps leverage costs.
Analysts see more room for Uber to improve margins and grow earnings at high-double-digit rates. The current consensus estimate is for 41% annualized earnings growth in the coming years. Despite a good runway of earnings growth ahead for Uber, the stock trades at a forward price-to-earnings multiple of 23.
2. MercadoLibre
MercadoLibre (MELI +1.82%) is leading the e-commerce market across Latin America, and this fast-growing market has made the stock an outstanding performer over the last decade. E-commerce sales in this region are expected to grow from $180 billion in 2024 to $260 billion by 2028, according to eMarketer.
NASDAQ: MELI
Key Data Points
The company is showing strong growth across various services, including commerce, fintech, and advertising. Revenue grew 35% year over year in Q3, as the business continues to experience robust gains in its online marketplace business.
Meanwhile, the company's fintech offering now has more than 56 million monthly active users, up 35% year over year for the last quarter. Its credit card offering has seen strong customer adoption, which tends to carry over to higher usage of the company's other services.
MercadoLibre is growing revenue consistent with past rates, yet the stock is still trading at a reasonable valuation. At just over 5 times trailing sales, the shares are trading well below its 10-year average of 10 times sales.
With uncertainty surrounding the economy, MercadoLibre shares could trade lower in the near term, but over the long term, investors should expect the stock to perform consistent with the growth in the business. If the P/S multiple stretches closer to its previous average, the stock could deliver incredible returns.
