The technology sector has been pushing higher in the past few years thanks to major trends like artificial intelligence. However, it isn't the only place to find attractive growth stocks. Let's look at three growth stocks in the consumer space that are well worth buying and holding for the long term.
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Amazon
Technically, Amazon (AMZN 1.35%) is a combination of technology and consumer stock, owning both the world's largest e-commerce platform and cloud computing business. However, one of the most attractive things about the stock is that it trades at a big discount to two of its primary retail peers -- Walmart and Costco Wholesale -- while growing its sales at a quicker pace.
AMZN PE Ratio (Forward) data by YCharts.
On top of that, Amazon's e-commerce operations are seeing tremendous operating leverage at the moment, which is leading to the unit's operating income growth greatly outpacing its revenue growth. This is a very underappreciated part of the Amazon story at the moment, as its investments in robotics and artificial intelligence (AI) have made its e-commerce business much more efficient.
At the same time, Amazon has also become one of the largest digital advertising platforms in the world. This business is growing briskly and also carries higher gross margins, which is also helping drive profit growth.
Meanwhile, the company's cloud computing business, Amazon Web Services (AWS), is growing quickly and starting to see revenue growth accelerate. This is actually the company's most profitable segment, and it is investing big to win big in the space, announcing it will spend a whopping $200 billion in capital expenditure (capex) to increase its data center capacity.
Given the operating leverage Amazon is seeing in its e-commerce business, together with the growth at AWS, this is a stock to buy and hold for the long term.
NASDAQ: AMZN
Key Data Points
Chewy
Chewy (CHWY 2.30%) is another cheap growth stock in the e-commerce space, trading at a forward price-to-earnings (P/E) ratio of just 15.5. At the same time, the company has been growing its sales nicely, with revenue up more than 8% through the first nine months of its fiscal 2025.
Chewy also has one of the most defensive business models in the retail space. The bulk of its sales comes from selling pet food and other essentials, such as pet medicine, much of which is just auto-shipped. Last quarter, 84% of its sales came from auto-ship customers, and its average auto-ship customer spends about $595 a year with it.
NYSE: CHWY
Key Data Points
At the same time, Chewy is also looking to expand its gross margins. It has leaned into private label brands and pet medication, which both carry high margins. It's also turned to sponsored ads, while also introducing a paid membership program.
Between these initiatives, its highly recurring business model, and strong sales, Chewy is a top retail stock to own.
Dutch Bros
One of the best growth stories in the consumer space, bar none, is Dutch Bros (BROS 4.28%). The coffee shop operator is seeing strong same-store sales and has a huge expansion opportunity still in front of it.
Last quarter, the company saw its comparable-store sales soar 7.7% with a 5.5% jump in transactions. The growth was boosted by continued momentum in mobile order ahead and the introduction of hot food items at stores. This should continue to be a driver as it rolls out food to more stores. Food has traditionally made up less than 2% of Dutch Bros sales versus around 20% for Starbucks, so this is a huge opportunity.
NYSE: BROS
Key Data Points
Meanwhile, the company has a huge expansion runway in front of it. It ended the year with 1,136 shops, with plans to expand that to more than 2,029 by 2029. Ultimately, it thinks it can support around 7,000 locations in the U.S. Its shops are relatively inexpensive to build and tend to have a quick payback period. Importantly, it can fund its aggressive expansion 100% through its operating cash flow.
Between its same-store momentum and expansion opportunity, Dutch Bros is a stock to buy for the long haul.
