The best growth stocks are usually those of companies doing something unique or innovating faster than the competition. Identifying these companies early enough in their growth journey could help you realize more gains than you ever dreamed from an investment. Great companies will just keep compounding their revenue, sending the stock higher over time.
To give you a few ideas, here are two fast-growing companies that could be in the early innings of a massive opportunity.
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1. Roblox
Roblox (RBLX -7.95%) stock is soaring in 2025, up 136% year to date at the time of writing. This could be a long-term multibagger in the making. Roblox has a powerful business model that leverages user-created content with social media elements that drives strong engagement. It currently has 112 million daily active users, but it's not done growing.
Roblox's user-created content model is unique in the gaming industry. Large game companies spend years investing millions in making just one video game that it hopes will be a blockbuster upon release. However, Roblox benefits from an army of content creators that make professionally designed content.
The value of this strategy is that Roblox can flood its platform with a steady flow of new gaming experiences to keep users engaged year-round. This resulted in more than 27 billion hours spent on the platform last quarter alone, which helped Roblox generate nearly $1.1 billion in revenue, up 21% year over year.
In exchange for creating highly engaging experiences for users, Roblox pays out fees to creators, which totaled $316 million last quarter. This payout has nearly doubled over the last two years, yet the economics of this model are working beautifully. Roblox's free cash flow has improved more than 11,000% to $941 million on a trailing-12-month basis.
The big opportunity for the company is leveraging artificial intelligence (AI) in the content creation process. New AI tools like Cube 3D allow developers to create 3D objects and characters with simple text descriptions. This will enable developers to make content faster than ever before, which could have a huge impact on Roblox's growth.
Investing in better tools to assist developers is part of management's long-term vision to have 1 billion users on the platform. If Roblox can 10x its user base, that would proportionally benefit its revenue and free cash flow, driving wealth-building returns for investors.
2. Robinhood Markets
Robinhood Markets (HOOD 1.99%) pioneered commission-free trading, and it has used that first-mover advantage to build a strong brand with young investors. Robinhood is not just a broker; it is rapidly evolving into a super app built for the future of finance.
The stock is up 271% year to date at the time of writing, bringing the company's market cap to $123 billion. But this company could easily be worth $1 trillion one day. Robinhood estimates its addressable market at more than $600 billion in revenue over the long term. If successful, this could translate to multi-bagger returns for investors.
Robinhood's platform assets have exploded over the last year. The company continues to see customers transfer assets into the platform as it continues to roll out new features and trading products. Total platform assets crossed $300 billion in August, more than doubling year over year.
The company has been releasing new products at an impressive clip, including launching a desktop trading platform, prediction markets, futures trading, and a robo-advisory service for investors that want to put their investments on autopilot, which it calls Robinhood Strategies. It also announced an AI-powered trading assistant called Cortex, which is all part of CEO Vlad Tenev's long-term vision to put a "world-class financial team in your pocket."
The company's recent growth shows it is succeeding in gaining market share against the big brokerage services. But the bigger opportunity for Robinhood is continuing to push deeper into financial services like credit cards and banking. Robinhood has built its brand around ease-of-use and powerful products that bring value to customers. Its new credit card had nearly 3 million people on the waitlist in March, and it is rolling out Robinhood Banking to select customers.
The more assets on the platform, the more opportunities to turn those assets into revenue. Robinhood is attracting assets the more it innovates, and it's just getting started. It is investing in a Layer 2 blockchain to pave the way for customers to be able to invest in tokenized private assets.Robinhood is building the future of trading, investing, and money management as digital assets take over traditional finance. It's leaving the big brokers flat footed, and that spells a great investment opportunity for investors.
