2024 was another great year for growth stocks. But with so many growth stocks performing well, it can be difficult to narrow down what stocks should be on your buy list as we start a new year.
Here are three of my favorites right now.
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1. Reddit
Even though Reddit (RDDT 7.13%) shares are up more than 200% in 2024, I like the stock heading into 2025. Reddit remains a relatively new public company, having just debuted via an initial public offering in March 2024. However, since its debut, the company has delivered for investors.
For example, in its most recent quarter (the three months ended Sept. 30, 2024), Reddit reported the following:
- Daily active users (DAUs) increased 47% year over year to 97 million.
- Revenue jumped an eye-popping 68% to $348 million.
- Net income swung from a $7 million loss one year ago to $29 million profit in the current quarter.
- Gross margin increased to 90%.
In short, Reddit is delivering in a big way in its first few months as a public company.
As 2025 gets underway, the company has plans to integrate artificial intelligence (AI) features that should help users discover new content on the company's message boards, driving further engagement and ad revenue for the company.
2. Robinhood Markets
Sometimes, investing comes down to simply noticing the entry of a new and exciting player in the market and taking advantage of it. I think that's the case when it comes to Robinhood Markets (HOOD 4.84%).
In truth, Robinhood isn't the first company to offer online stock, options, and crypto trading accounts. Far from it. However, the company made a splash, attracting many new clients -- particularly among young investors. The numbers speak for themselves.
In its most recent quarter (the three months ended Sept. 30, 2024), Robinhood reported:
- A 72% increase in transaction-based revenue to $319 million, led by options and crypto trading.
- A 31% increase in average revenue per user (ARPU).
- Total investment account growth of 6% to 25.1 million.
In short, Robinhood is winning thanks to a tried and true method: outperforming its competitors through innovation and execution. And that makes it a company and stock worth noticing as 2025 gets started.
3. Duolingo
A longtime favorite stock for me, Duolingo (DUOL 4.35%) turned in another fantastic year in 2024, as the stock advanced more than 40%.
Behind that impressive stock performance are outstanding financial figures. The company continues to grow revenue at a breakneck pace of 40% year over year. What's more, DAUs jumped 54%, and paid subscribers increased by 47%.
The secret to the company's success is an amusing and addictive app that helps people master a new language, learn to read and play music, and even master math. All in all, the Duolingo app delivers serious educational content in a fun package, with a cheeky mascot to boot.
As 2025 advances, the company will continue expanding its product offerings (many of which are generated using AI), including conversational AI language learning.
