Key Points

• This tech leader is seeing growing demand for cloud services, yet its stock trades at just 14 times expected earnings.

• A well-known athleisure superstar looks like it's oversold, and value investors should take a look.

• This diversified apparel company could be at the start of a turnaround.

• 10 stocks we like better than Alibaba Group ›

The stock market has shown incredible resiliency in 2025. After shaking off the trade wars and uncertainty for the economy, the S&P 500 is sitting close to new all-time highs. As August, which is historically a weak month for the markets, approaches, there are solid companies trading at reasonable valuations that are worth buying.

If you have $1,000 to commit to a long-term investment plan, read why three Motley Fool contributors like Alibaba (NYSE: BABA), Lululemon Athletica (NASDAQ: LULU), and VF Corp (NYSE: VFC) right now.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

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An undervalued tech giant

John Ballard (Alibaba): Shares of Alibaba are starting to climb out of the slump they've been in for the past few years. This is a great time to consider starting an investment in the tech giant. An improving economy in China and strong demand for the company's cloud services are major catalysts that could potentially double the share price within five years.

Alibaba's e-commerce marketplaces, Taobao and Tmall, are posting steady growth in 2025. The March-ending quarter showed these businesses growing customer management revenue by 12% year over year. This primarily comes from fees charged to third-party merchants that sell goods on these marketplaces, which creates very profitable revenue streams for Alibaba.

Alibaba has multiple levers to grow revenue in its e-commerce business. It credited recent growth from several initiatives, including the integration of its Cainiao logistics in its e-commerce business, in addition to new software service fees that helped capture a higher percentage of revenue from merchant activities.

Another catalyst supporting the stock's recovery is strong growth in Alibaba Cloud. Enterprises are adopting artificial intelligence (AI) services at a rapid rate. Alibaba said its AI-related product revenue has grown at a triple-digit rate for seven consecutive quarters. Its investments in AI are positioning the company for strong growth over the next decade.

Despite positive trends across the company, investors can buy shares at just 13.5 times this year's consensus earnings estimate -- a genuine bargain. The stock could double if investors pay a higher multiple of earnings that is consistent with the average S&P 500 price-to-earnings multiple of 30. Wall Street appears to be in the process of rerating Alibaba shares right now, making it a timely buy for the month of August.

Too cheap to ignore

Jennifer Saibil (Lululemon): Lululemon has been having a very tough time over the past few years, and its stock is down around 45% in 2025 alone. However, at the current price, it looks like the market is overselling it, and it's trading at a bargain price.

After many years of strong growth, that growth has decelerated sharply. There are several factors working against it, including pressure in discretionary spending and increasing competition. Lululemon helped create the athleisure movement, but there are low barriers to entry in its industry. In fact, in the premium athleisure space, customers are often looking for the next important and exclusive brand. On top of that, there have been worries about how Lululemon will be affected by tariffs. It's no wonder investors have been losing enthusiasm for the stock.

The 2025 fiscal first quarter (ended May 4) did little to quell the pessimism. Sales increased 7% year over year in the quarter, but comparable sales (comps) were up only 1%. Even worse, they decreased 2% in the Americas region. Management maintained its guidance for a mid-single-digit increase in revenue for the full year, but it revised its guidance down for full-year earnings per share (EPS).

However, there's reason for optimism. Lululemon stock trades at a P/E ratio of only 14, and at this price, it looks like a good value. Lululemon is highly profitable with an operating margin of 18.5%. That was down 1.1 percentage points from last year in the first quarter, mostly due to tariffs. However, it's still industry-leading, way above similar athletic wear and regular apparel companies.

The tariffs situation could be improving as the Trump administration continues to make deals with other countries. And in terms of other countries, although the Americas market has been disappointing, Lululemon is doing very well in China, where sales increased 22% over last year in Q1.

At the current price, it could finally be time to give Lululemon stock another shot, especially if you're looking for a value stock.

A turnaround is afoot at VF Corp.

Jeremy Bowman (VF Corp): With the broad market at an all-time high, it may be a good time for investors to look to beaten-down stocks that could be undervalued.

VF Corp. looks like one of those stocks right now. The apparel brand manager, which owns brands like Vans, The North Face, Timberland, and Dickies, has been one of the worst-performing apparel stocks in the market over the last five years. The stock is down about 85% from its peak in 2021.

Weakness at Vans, a dividend cut, and broader headwinds on consumer discretionary products all weighed on the stock, but VF Corp. showed signs of a turnaround in the fiscal Q1 earnings report on Wednesday.

While overall revenue was flat, the company delivered solid growth at all of its core brands except Vans, which is going through a "channel rationalization," meaning management is reducing the number of distribution points. However, Timberland was up 11%, and The North Face was up 6%. Vans, on the other hand, was down 14%, but the overall business is healthier than it might look.

If management can stabilize Vans and improve profitability, the company should be on good footing. Its adjusted operating loss was much better than expected in Q1, and management's guidance calls for full-year growth in adjusted operating income and free cash flow.

VF Corp. now trades at a price-to-sales ratio of just 0.5. That gives the stock upside potential if it can achieve a profit margin of just 5%, which would equal a price-to-earnings ratio of just 10 at the current P/S ratio.

For a company with a set of well-known premium brands, that should be achievable. If the turnaround continues to make progress, VF could double or triple from here.

Should you invest $1,000 in Alibaba Group right now?

Before you buy stock in Alibaba Group, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Alibaba Group wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $625,254!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,090,257!*

Now, it’s worth noting Stock Advisor’s total average return is 1,036% — a market-crushing outperformance compared to 181% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of July 29, 2025

Jennifer Saibil has no position in any of the stocks mentioned. Jeremy Bowman has no position in any of the stocks mentioned. John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Lululemon Athletica Inc. The Motley Fool recommends Alibaba Group. The Motley Fool has a disclosure policy.

Key Points

• This growth stock is up over 40-fold since 2015 and is still growing revenue at high rates.

• This e-commerce powerhouse operates in an environment where 85% of sales are still offline, giving it a long growth runway.

• This streaming stock could be at a turning point.

• 10 stocks we like better than Shopify ›

Building wealth in the stock market is not difficult. The biggest challenge is staying focused on the long-term potential of a business when market volatility strikes, as it inevitably will. As long as you invest in competitively positioned companies that have lots of room to expand over the long term, you're going to be successful.

As the markets hit new highs at the midway point of 2025, three Motley Fool contributors believe Shopify (NASDAQ: SHOP), MercadoLibre (NASDAQ: MELI), and Roku (NASDAQ: ROKU) can make solid additions to a long-term investor's portfolio. Here's why these stocks are poised to deliver outstanding returns.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

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An excellent stock to invest in e-commerce growth

John Ballard (Shopify): Shopify has been an amazing performer for investors. The shares have rocketed from a split-adjusted share price of about $3 following its initial public offering in 2015 to around $120 today. But what makes Shopify a brilliant growth stock is that it is still growing revenue at over 20% annually, with potential to keep growing at high rates for a long time.

The company's main driver of growth is not subscriptions to its platform, but merchant solutions, such as payment processing, shipping solutions, and capital lending. Shopify has reported 20% or more quarterly revenue growth for the last two years, with merchant solutions now comprising 74% of the business.

Merchant solutions are a high-margin revenue stream for Shopify. Because of this, Shopify continues to invest in driving this side of the business. Over the last year, it doubled the number of markets for Shopify Payments. It is also launching free tools, such as TariffGuide.ai, which uses artificial intelligence to help merchants figure out how to reduce costs in their supply chain based on product details. Shopify's innovation is an advantage in building the go-to operating system for e-commerce.

Of course, merchant solutions only grow if businesses using Shopify's platform are selling more and generating payment fees. This incentivizes Shopify to help merchants succeed. This forms a sort of partnership between the company and its merchant customers, which ultimately benefits the company and shareholders.

E-commerce is a multitrillion-dollar market, yet the total value of transactions completed by a Shopify merchant in the last quarter was less than $75 billion, or $350 billion on an annual run-rate basis. The recent expansion of Shopify Payments to 16 new markets should help it further penetrate this opportunity to drive more growth. All signs point to Shopify growing substantially in the years to come.

Great performance, tons of opportunity

Jennifer Saibil (MercadoLibre): MercadoLibre is an e-commerce powerhouse serving Latin America, and it's demonstrating fantastic growth. Its population is underpenetrated in e-commerce, giving it a long growth runway. It also has a growing presence in financial services, and its wide-ranging businesses in areas that are still adopting technology mean it has years of growth ahead.

In the 2025 first quarter, revenue increased 64% (currency neutral) year over year. Gross merchandise volume (GMV) was up 40%, and total payment volume increased 72%. It's also highly profitable. Operating income increased 45% over last year with a 12.9% margin.

Although e-commerce is growing rapidly, physical stores still account for 85% of sales in the company's regions. As the leader in e-commerce, MercadoLibre has 5% of the total retail market, and it's helping to generate the shift over to digital shopping by improving its value proposition with speedy deliveries, an increased assortment, and more. It's working, and unique active buyers continue to increase, up 25% year over year to 67 million in the first quarter. Like Amazon, it's also monetizing its platform with a lucrative and growing advertising business.

The fintech business is younger and growing even faster. Monthly active users increased 31% year over year in the first quarter to 64 million, and the credit portfolio increased 74%. The large incumbent banks in Latin America still account for the vast majority of banking in the region, but MercadoLibre is capturing market share through offering easy-to-use digital services and high yields on accounts. It's also expanding its platform with new products and features, and it's planning to open a fully digital bank in Mexico and Argentina.

MercadoLibre stock is up 41% year to date, crushing the market. It's been especially attractive to investors this year since it has low exposure to tariffs, but it tends to beat the market at any time. With its well-run business and wide opportunities, it should continue to create shareholder value for the foreseeable future.

This streaming stock could be ready for a breakout

Jeremy Bowman (Roku): There's no doubt that Roku has struggled in recent years. The leading streaming distribution platform is still operating at a loss, even though streaming now has a larger share of viewing in the U.S. than broadcast and cable combined.

The stock has been a laggard as well since a pandemic surge led to a collapse, but it could finally be ready to turn the corner. First, Roku said it expected to report an operating profit on a generally accepted accounting principles (GAAP) basis in 2026, and the company's recent results continue to show it making progress toward that end. In the first quarter of 2025, the company reported revenue growth of 16% to $1.02 billion, and its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) improved 37% to $56 million.

Last month, Roku announced a new partnership with Amazon, integrating Roku's authenticated CTV footprint with Amazon's DSP (demand-side platform). The partnership gives Roku a new way to leverage its ad inventory and technology and neutralizes one of its closest competitors in streaming distribution.

Additionally, the recent earnings report from Netflix showed that there's still robust growth in the streaming sector if Roku can take advantage of it. Meanwhile, Alphabet also showed off solid growth in its earnings report with advertising growth at 10%.

Analysts are expecting 11% growth from Roku in the second quarter to $1.07 billion when it reports earnings in August. If the company can top that and take steps toward profitability, there's a lot of upside potential for the stock.

Should you invest $1,000 in Shopify right now?

Before you buy stock in Shopify, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Shopify wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $636,774!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,064,942!*

Now, it’s worth noting Stock Advisor’s total average return is 1,040% — a market-crushing outperformance compared to 182% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of July 21, 2025

Jennifer Saibil has positions in MercadoLibre. Jeremy Bowman has positions in Amazon, MercadoLibre, Netflix, Roku, and Shopify. John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, MercadoLibre, Netflix, Roku, and Shopify. The Motley Fool has a disclosure policy.

At the end of this year, Warren Buffett will be stepping down as Berkshire Hathaway's CEO. Buffett has built an incredible track record of success since taking over the business in 1965 and using it as the foundation for an investment conglomerate that would go on to become one of the world's largest and most successful companies.

Buffett mostly made his name and delivered fantastic returns for shareholders through the principles of value investing, but Berkshire has also come to have a larger exposure to technology trends and growth stocks in recent years. And in the tech space, no trend is bigger or more important than artificial intelligence (AI) right now. With that in mind, read on for a look at two stocks that account for roughly 22% of Berkshire Hathaway's $282 billion stock portfolio.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

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1. Apple

Keith Noonan (Apple): With a market capitalization of $3 trillion, Apple (NASDAQ: AAPL) stands as the world's third-largest company, trailing only Microsoft and Nvidia. Coming in at 21.6% of Berkshire's total stock portfolio, it's also the investment conglomerate's single largest publicly traded company. It retains that distinction even though Buffett's company sold more than 600 million shares of Apple stock last year.

In general, Berkshire Hathaway has been reducing its stock holdings and building up its cash position recently. The move likely reflects concerns that the market at large has become expensive relative to the level of macroeconomic and geopolitical risks that Berkshire's analysts see on the horizon. On the other hand, the move to significantly reduce its Apple holdings likely reflects some specific concerns facing the business.

While Apple's leading position in mobile hardware gives it a strong foundation to build out its artificial intelligence (AI) business, the company also seems to be behind leading players including Microsoft, Alphabet, and Meta Platforms in some key respects. For example, Apple has reportedly had significant trouble getting its next-gen, AI-powered Siri platform up to the performance levels that developers were targeting.

Additionally, Apple is facing some significant challenges in the Chinese market. The rollout of the company's Apple Intelligence platform was delayed last year because Apple had not found a Chinese company to partner with to roll out the software locally. As a result, sales for the iPhone 16 were relatively soft in the market. The mobile hardware giant has now partnered with Alibaba Group Holding to make its AI software available, but Chinese customers are still showing increased preference for domestic technology brands -- and geopolitical dynamics could create continued headwinds.

Berkshire's move to reduce its position in Apple has meant that Buffett's company has also actually reduced its investment exposure to the overall AI trend. On the other hand, Apple has still retained its status as Berkshire's largest stock holding -- and it seems clear that Buffett remains a big fan of the business. Apple has yet to match the AI successes of some other top tech players, but the company's many strengths suggest it still has many opportunities to be a big winner in the space.

2. Amazon

Jennifer Saibil (Amazon): Amazon (NASDAQ: AMZN) makes up a small percentage of the Berkshire Hathaway portfolio, and Buffett didn't even buy it. He said that one of the portfolio's investing managers, Todd Combs or Ted Weschler, pushed the button on Amazon stock, because tech isn't really in his wheelhouse. However, he's also said that he made a mistake by not buying it earlier.

Amazon is so much more than AI, but generative AI is leading it forward today, representing its greatest growth opportunities. Amazon Web Services (AWS) is Amazon's cloud computing business, where much of the generative AI is taking place. It's the largest cloud services business in the world, with 30% of the market, according to Statista.

CEO Andy Jassy believes that very soon all apps will be built with a generative AI component, like databases and storage today. Most of that is going to be built on the cloud, and as the leader, Amazon will account for a vast amount of it. "Before this generation of AI, we thought AWS had the chance to ultimately be a multi-hundred-billion dollar revenue run rate business," Jassy said on a recent earnings call. "We now think it could be even larger."

To make that happen, Amazon offers the largest assortment of generative AI tools and services throughout the three layers of its program. The bottom layer is complete customization for its largest clients to build their own large language models (LLMs), the foundation of generative AI. The middle layer is semi-custom solutions through the Amazon Bedrock program, and Amazon offers several tools in the top layer for small businesses that need ready-made programs. These are tools like the ability to create full product descriptions based on prompts.

AWS already pulls more than its own weight for Amazon. Sales increased 17% year over year in the first quarter, making it the second-fastest-growing segment behind advertising, and it accounted for 63% of operating income.

Will Berkshire Hathaway buy more Amazon stock after Buffett steps down as CEO at the end of the year? It will be interesting to see whether or not the equity positions change without Buffett in the top spot.

Should you invest $1,000 in Apple right now?

Before you buy stock in Apple, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Apple wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $868,615!*

Now, it’s worth noting Stock Advisor’s total average return is 792% — a market-crushing outperformance compared to 171% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 2, 2025

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Jennifer Saibil has positions in Apple. Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Berkshire Hathaway, Meta Platforms, Microsoft, and Nvidia. The Motley Fool recommends Alibaba Group and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

Warren Buffett has led an incredibly successful career as an investor. His knack for spotting value where others don't built a struggling textile mill in the 1960s into a company worth $1 trillion in 2025.

Through the first quarter, Buffett's Berkshire Hathaway held a stock portfolio worth $263 billion. It's full of solid companies that can help you grow your savings. Some of these positions are managed by one of Buffett's hired investing deputies (Todd Combs or Ted Weschler).

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Coca-Cola (NYSE: KO), Domino's Pizza (NASDAQ: DPZ), and Amazon (NASDAQ: AMZN) are three stocks from Berkshire's holdings that would make great additions to any investor's portfolio right now. Here's why three Fool.com contributors like these stocks as long-term investments.

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Buffett's longest-held stock

Jennifer Saibil (Coca-Cola): Warren Buffett bought Coca-Cola stock 37 years ago, and he has said he would never sell it. Although other investors might question his affection for the beverage giant, which has underperformed the market for much of the recent past, today's market makes it clear why it's an excellent addition to a well-diversified portfolio.

Coca-Cola is the largest beverage company in the world, with nearly $47 billion in trailing-12-month sales. Despite global economic upheaval over the past few years, it has managed to generate higher sales and robust profitability. It's a much-loved global brand, and everyone needs to drink. Although there might be some switching down when prices go up, a can of Coke won't set you back too much. The company has been able to raise prices without curbing demand, and it has also launched smaller packaging to make it easier for fans to buy it.

Investors have also been impressed with management's reaction to tariffs. CEO James Quincey has explained that even though Coca-Cola is a global brand, much of its production is done locally. It makes most of its concentrate in the U.S., shielding it from at least some of the impact of tariffs.

Even more, Coca-Cola is a Dividend King, and it's raised its dividend for the past 63 years straight. That's longer than Buffett has been at the helm of Berkshire Hathaway, and it's as reliable as any dividend stock. Plus, the dividend yield is higher than many other Dividend Kings. Today, it's 2.7% because Coca-Cola stock is performing so well this year -- up 15% -- but it's typically closer to 3%.

If you're a young growth investor, you may not want to make Coca-Cola stock a central part of your portfolio, but it provides safety and passive income for any kind of portfolio.

Image source: Getty Images.

A recession-resistant restaurant chain

Jeremy Bowman (Domino's Pizza): The trade war and concerns about a recession have put pressure on a number of restaurant chains -- McDonald's, Chipotle, and Starbucks have all noted pressure on traffic from the economy.

Domino's might be the restaurant chain that's best positioned to fend off economic pressure, as it's a global franchisor, and it offers both compelling value and convenience for consumers during tough times. The company has a long track record of growing comparable sales in a wide variety of economic conditions, and it should be able to do the same even if the economy goes sour.

In its first quarter, Domino's reported same-store sales growth of 3.7% in international markets, though U.S. comps were down slightly at 0.5%. Global retail sales rose 4.7%.

Domino's also continues to expand, and, with its franchise model and the global popularity of pizza, the company appears to have a long runway of growth ahead of it. Domino's now has more than 21,000 locations around the world, including more than 14,000 in international markets and more than 7,000 domestically.

Overall, Domino's has many of the makings of a classic Buffett stock. It has a competitive advantage thanks to its global brand and network of more than 20,000 locations that are supplied by Domino's facilities. It also has a recession-resistant business model and product, and it's a durable business that can continue to produce cash flow for decades to come, returning to investors both through dividends and share repurchases.

Image source: Amazon.

Amazon's customer-centric business strategy is a long-term winner

John Ballard (Amazon): Amazon has made investors a lot of money over the last few decades by focusing on one simple thing: delighting its customers. Whether it's offering a smooth online shopping experience or offering mission-critical cloud services to large businesses, Amazon has focused on offering great service to customers of all stripes, and it's led to tremendous growth in revenues and profits.

Berkshire Hathaway first bought a stake in the online retail giant in 2019 and still held 10 million shares at the end of 2024.

Amazon's sales growth is slowing as it gets larger, but management is targeting greater efficiency and cost savings to improve margins, which is boosting earnings growth. The company's net profit grew 64% year over year in the first quarter to $17 billion. There are not many large companies growing profits at these high rates.

The company is still relentless in finding ways to satisfy customers. It's preparing to launch a satellite broadband service (Project Kuiper), and it just launched the first satellites into orbit. It aims to offer the service to millions of households in underserved rural areas.

Project Kuiper would be a key asset in getting more rural households to shop and engage with Amazon's Prime service offerings more frequently. Along with these efforts, Amazon is investing $4 billion through 2026 to expand its rural delivery network in less populated areas of the U.S.

Amazon clearly has a lot of room to grow, and there are still plenty of growth opportunities internationally. Meanwhile, its cloud enterprise service is growing as more businesses migrate their data systems to the cloud to take advantage of artificial intelligence (AI) services. Revenue from Amazon Web Services grew 17% year over year in Q1 and contributed over 60% of the company's operating profit.

The stock is down year to date, as Wall Street focuses on near-term headwinds in the economy, but investors can expect Amazon to keep growing in value over time and deliver excellent returns.

Should you invest $1,000 in Coca-Cola right now?

Before you buy stock in Coca-Cola, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Coca-Cola wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $614,911!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $714,958!*

Now, it’s worth noting Stock Advisor’s total average return is 907% — a market-crushing outperformance compared to 163% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of May 5, 2025

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon, Chipotle Mexican Grill, Domino's Pizza, and Starbucks. The Motley Fool recommends the following options: short June 2025 $55 calls on Chipotle Mexican Grill. The Motley Fool has a disclosure policy.

Buying shares of growing companies and holding patiently for many years is a simple path to building wealth. When you can buy shares of these companies at lower prices, it can help boost your long-term returns.

To give you some ideas, read why three Motley Fool contributors see long-term upside in Dutch Bros (NYSE: BROS), Axon Enterprise (NASDAQ: AXON), and MercadoLibre (NASDAQ: MELI).

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Huge expansion opportunities make this stock a no-brainer buy

Jennifer Saibil (Dutch Bros): Volatile market conditions are creating incredible buying opportunities right now, but not all stocks are plunging. Consider Dutch Bros. It's dropped over the past few weeks with the market turmoil, but it's still up 18% this year, crushing the market.

Why are investors so excited about this stock? Its long-term opportunity is incredibly compelling. It operates a chain of coffee shops and distinguishes itself with a down-to-earth brand, unique beverages, and low prices. It's also meeting this moment in time, with most of its stores exclusively drive-thrus, although it's opening new stores in different formats to meet location-based demand.

Unlike some giant competitors, it's new and agile and building out with omnichannel options, technology, and speed in mind.

The response has been very positive, leading investors to believe that this company can indeed expand from its current 1,000-store count to the 7,000 stores it envisions. It will take time, but that just gives investors more years to benefit. That number is still way behind leader Starbucks, implying that there's also room to keep expanding.

Revenue keeps growing at a rapid pace. It increased 35% year over year to $343 million in the 2024 fourth quarter, with same-store sales up 6.9% and same-store transactions up 2.3%. Company-operated shop contribution margin expanded by 2.4 percentage points to 28.9%, indicating that the company is getting more out of each store, and Dutch Bros is benefiting from strong economies of scale. Net income increased from a $3.8 million loss the year before to positive $6.4 million in the quarter.

At the current price, Dutch Bros stock still isn't cheap. It trades at a forward 1-year P/E ratio of 74. That tells you how much the market is expecting from this amazing stock, and if you buy today and hold for 10 years, you're likely to be well-rewarded.

A niche tech winner

Jeremy Bowman (Axon Enterprise): Axon Enterprise, the maker of Taser electrical weapons and body cameras, has dominated the stock market over the last 10 years, and looks poised to continue to do so over the next 10 years.

The company has established itself as the clear leader in law enforcement technology, with a network of products including hardware like the items listed above and software that helps law enforcement agencies manage records, evidence, and investigations.

Axon is also continuing to innovate in the AI era, introducing Draft One, a generative AI tool that writes first drafts of police reports based on footage from body and dashboard cameras. The technology is reportedly very popular with law enforcement agencies.

Looking out over the next decade, the company has several advantages that should drive the stock higher. First, it's the clear leader in its industry, meaning it should continue to build scale and expand relationships with its customers as it introduces new products. Axon has also demonstrated its ability to deliver consistent growth, generating revenue growth of 20% or more every year for the last 10 years.

The company is even expanding beyond its traditional customer base into the private sector. Last year, its biggest contract went to a logistics company, possibly FedEx or United Parcel Service, that wanted body cameras for its frontline delivery drivers. This shows that there are applications beyond law enforcement.

Finally, Axon seems well-equipped to ride out the disruption from tariffs and a potential recession. It sells its products primarily to state and local governments, and its technology can help agencies save money. Overall, Axon is in great shape to deliver strong results over the next 10 years.

Meet Latin America's leading e-commerce company

John Ballard (MercadoLibre): Shopping online and using digital financial services is common in the U.S., but there's a huge opportunity in other regions of the world. For example, 35% of adults in Latin America don't even have a bank account as of 2023, according to eMarketer. This is a huge opportunity for e-commerce and fintech powerhouse MercadoLibre. The stock delivered a return of 1,400% over the last 10 years, with room to run over the next decade.

The opportunity for growth is so huge that MercadoLibre has been at this for over 25 years and is still growing revenue at high double-digit rates. In the fourth quarter, revenue jumped 37% over the year-ago quarter. It continues to gain market share across its three largest markets -- Brazil, Mexico, and Argentina.

MercadoLibre offers an online marketplace with 67 million unique active buyers and growing. It's also seeing strong growth for financial services, including mobile payments and credit cards. Overall, the company's revenue reached $21 billion in 2024, and it converted that into $1 billion of free cash flow.

The business is capable of generating even higher margins and free cash flow relative to revenue. But there are tremendous opportunities to invest in growth, such as issuing credit cards that serve as a gateway to other services it offers, in addition to opening new fulfillment centers to support marketplace growth. These investments could pressure near-term margins but have a big payoff over time.

The stock has traded at a price-to-sales multiple between 3.6 to 25.9 over the last decade. It currently trades at the low end of that range, sitting at 5.3 times trailing revenue at the time of writing. MercadoLibre investors should expect excellent returns as the company continues to expand across a region with 650 million people.

Should you invest $1,000 in Dutch Bros right now?

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Jennifer Saibil has positions in MercadoLibre. Jeremy Bowman has positions in Axon Enterprise, MercadoLibre, and Starbucks. John Ballard has positions in Dutch Bros and MercadoLibre. The Motley Fool has positions in and recommends Axon Enterprise, FedEx, MercadoLibre, and Starbucks. The Motley Fool recommends Dutch Bros and United Parcel Service. The Motley Fool has a disclosure policy.

The stock market has gotten off to a bumpy start in 2025, with the S&P 500 index down sharply. On the other hand, taking a buy-and-hold approach to great companies on the heels of recent valuation discounts could open the door for patient investors to see very strong returns.

With that in mind, read on to see why two Motley Fool contributors think that these stocks below will crush the S&P 500 over the next three years.

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This company is on the verge of a game changer

Keith Noonan (Take-Two Interactive): The video game industry is now bigger than the movie industry and the music industry combined, and Take-Two Interactive Software (NASDAQ: TTWO) stands out as a leading player in the space. In fact, Take-Two would be my hands-down, go-to pick if I had to choose the one company most likely to release this next decade's most successful entertainment product.

Later this year, the company is scheduled to launch Grand Theft Auto VI (GTA VI), the follow-up to the most profitable entertainment product ever. First released in 2013, Grand Theft Auto V has now sold more than 210 million copies. The game has also generated massive amounts of high-margin revenue through in-game purchases made by players of its online multiplayer mode.

GTA VI may or may not be able to match the unit sales of its series predecessor, but it's almost certain that the game is going to be a massive earnings generator for Take-Two. The game is set to take the online multiplayer component to an even higher level, and in-game purchases made through Grand Theft Auto VI will be a huge performance driver for the company.

It is poised to be a disruptive release in the video game industry -- so much so that some other publishers plan on avoiding the game's release window rather than trying to release competing products in the same window. The highly awaited sequel is on track to dominate the sales charts this year and soak up tons of attention from players.

Some reports have even suggested that Take-Two could price a copy of Grand Theft Auto VI at roughly $100, which is significantly above the $70 level that's the norm for big-budget, current-generation games. Whether or not the company will make that move is still unclear, but it wouldn't be shocking to see the publisher flex the pricing power of its upcoming landmark release.

With GTA VI seemingly on the verge of shaking up the entertainment industry, Take-Two is one of my favorite stocks right now.

A no-brainer path toward growth

Jennifer Saibil (Dutch Bros): Dutch Bros continues to crush the market right now, up roughly 1% this year as the S&P 500 is down 15%. It has tons of opportunity, and it's likely to keep outperforming the market over the next three years and beyond.

It operates a chain of nearly 1,000 coffee shops as of the end of 2024, and many of them are just drive-thrus. However, even outside of its stores, it's creating an ambiance that consumers are warming up to, with broistas (its term for baristas) walking through the lanes and taking orders.

The focus is on speed and customer service, and as it rolls out new stores, it's working with different formats to be able to handle demand efficiently. Customers also enjoy its distinctive branded beverages and price point, which is cheaper than leader Starbucks.

Dutch Bros is demonstrating robust growth and increasing profits. Revenue rose 35% year over year in the fourth quarter, driven by 32 new stores and a 6.9% year-over-year increase in same-store sales. Company-operated shop contribution profit increased 51% with a 28.9% margin, up 2.4 percentage points. Net income increased from a $3.8 million loss to $6.4 million.

Management has ambitions to expand to 4,000 stores over the next 10 to 15 years. It's planning to open at least 160 stores in 2025, and it will need to accelerate the rate of openings to reach that goal. But if it can, it's a no-brainer for sales growth.

At the same time, it's rolling out stores with consumer preferences and profitability in mind. As it builds its brand presence and gains loyalty, it should be able to continue enjoying same-store sales growth as it expands, raising its potential. It also just launched a new mobile-order program that's gaining traction and demonstrating promise as a growth driver.

There's so much to expect from Dutch Bros over the next three years and longer, and the stock is a strong contender to keep beating the market.

Should you invest $1,000 in Dutch Bros right now?

Before you buy stock in Dutch Bros, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Dutch Bros wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $496,779!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $659,306!*

Now, it’s worth noting Stock Advisor’s total average return is 787% — a market-crushing outperformance compared to 152% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of April 10, 2025

Keith Noonan has positions in Take-Two Interactive Software. The Motley Fool has positions in and recommends Starbucks and Take-Two Interactive Software. The Motley Fool recommends Dutch Bros. The Motley Fool has a disclosure policy.