With the stock market settling in after a volatile period, now is a good time to start looking at some leading growth stocks that have strong potential over the next decade.

Here are five growth stocks across industries that investors can look to hold for the long term.

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1. Taiwan Semiconductor Manufacturing

Taiwan Semiconductor Manufacturing (NYSE: TSM) is one of the most critical players in the artificial intelligence (AI) boom. As the world's leading contract chip manufacturer, TSMC manufactures the advanced semiconductors powering a range of products from AI infrastructure to smartphones and automotive tech.

Producing these chips isn't easy, as it requires leading-edge technology, precision manufacturing, and scale. Few companies in the world have the capabilities or the track record that TSMC does, and with competitors struggling, it has also garnered strong pricing power.

As such, the company has become the go-to partner for top chip designers, thanks to its leadership in advanced nodes and packaging. Advanced nodes refer to manufacturing processes that allow more transistors to be packed onto a chip, which in turn boosts performance and power efficiency.

Meanwhile, demand for high-performance computing, including AI chips, has exploded. With AI workloads growing, TSMC is expanding capacity alongside key customers to meet future demand.

Despite its pivotal role in the AI supply chain, TSMC's stock still looks reasonably valued. For long-term investors looking to benefit from the continued growth in AI infrastructure and semiconductors in general, TSMC is a great stock to hold.

2. Pinterest

Pinterest (NYSE: PINS) has undergone a quiet but powerful transformation under CEO Bill Ready. Over the past three years, the company has invested heavily in technology to turn its massive user base, which now sits at more than 570 million monthly active users worldwide, into a growth engine. Pinterest is no longer just an online vision board; it's become a shoppable platform with growing ad conversion capabilities.

One of the big drivers behind Pinterest's transformation has been its embrace of AI. The company built a multimodal model trained on both images and text to better understand what users are looking for. This powers personalized recommendations, while a visual search feature makes it easier for users to find and shop for products they see in pinned images. On the backend, meanwhile, its Performance+ platform is giving advertisers the tools to run better campaigns.

The results speak for themselves. Last quarter, Pinterest's revenue jumped 16%. Average revenue per user (ARPU) climbed across all regions, especially outside the U.S., where Pinterest is starting to better monetize users in emerging markets through the help of a partnership with Google.

Pinterest's stock still looks attractively valued, and the company is just scratching the surface of monetizing its user base. With AI-powered tools and a more shoppable platform, Pinterest has solid long-term investment potential.

3. Dutch Bros

Dutch Bros (NYSE: BROS) is shaping up to be one of the most compelling expansion stories in the restaurant space. With just over 1,000 locations across 18 states, the company believes it can more than double its footprint to 2,029 shops by 2029, and it sees the opportunity to eventually support 7,000 coffee shops nationwide.

Meanwhile, its small, drive-thru-focused shops are inexpensive to build, have attractive unit economics, and offer fast payback periods.

What makes the story even more attractive, though, is that Dutch Bros is only now starting to unlock other key growth levers. Mobile ordering, for example, is still early but gaining traction, accounting for only 11% of transactions last quarter. Mobile ordering also feeds into its loyalty program, allowing it to personalize its marketing and promotions.

The company is also leaning into food, testing hot items to drive breakfast sales at a few select locations. Food currently makes up less than 2% of sales, compared to nearly 20% at Starbucks, so there's real upside here. With more menu expansion and store openings on the way, Dutch Bros looks like a long-term winner.

4. Philip Morris International

Philip Morris International (NYSE: PM) is a growth stock in a defensive industry. While many tobacco companies are struggling with declining cigarette volumes in the U.S., Philip Morris doesn't have to worry about that because it doesn't sell cigarettes domestically. Instead, its growth is being driven by its smokeless portfolio, led by Zyn and Iqos, both of which have better unit economics than traditional cigarettes.

Zyn, its fast-growing nicotine pouch, has been its biggest growth driver, as evidenced by U.S. shipment volumes jumping 53% in Q1.

Meanwhile, Iqos, its premium heated tobacco product, continues to gain traction in Europe and Japan, with early success in new markets like Mexico City, Jakarta, and Seoul. In addition, after buying back its U.S. rights from Altria, the U.S. has the potential to be its next big growth driver. At the same time, its traditional cigarette business remains stable overseas, helped by strong pricing power and steady demand.

With strong pricing power, local manufacturing that limits tariff exposure, and growing demand for Zyn and Iqos, Philip Morris looks well positioned to keep delivering strong growth in the future.

5. Eli Lilly

Eli Lilly (NYSE: LLY) has emerged as a leader in the booming GLP-1 drug space, with surging demand continuing to drive strong revenue growth. Last quarter, its two key GLP-1 drugs -- Mounjaro and Zepbound -- generated a combined $6.1 billion in revenue, up sharply year over year. While Zepbound is officially approved by the Food and Drug Administration (FDA) for weight loss in obese adults or overweight adults with at least one weight-related condition, and Mounjaro is approved to help adults with type 2 diabetes, the reality is that the growth of these drugs is being driven by their being prescribed off-label for weight loss.

However, the drug that could be the biggest game changer for Lilly is still on its way. Orforglipron, its first oral GLP-1 drug candidate, recently demonstrated in a phase 3 trial that patients who took the drug lost considerable weight. As an oral medication, it is a much more convenient alternative to injectable GLP-1 drugs, making it especially appealing to patients who are wary of needles.

Orforglipron is also easier to manufacture and distribute than injectable drugs, as it doesn't require cold storage or injection pens. This should help Lilly avoid the supply constraints it saw with its injectable GLP-1 portfolio. With orforglipron looking like it has the potential to be the most potent oral GLP-1 weight loss drug on the market, Lilly is well positioned for continued future growth.

Should you invest $1,000 in Taiwan Semiconductor Manufacturing right now?

Before you buy stock in Taiwan Semiconductor Manufacturing, 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 Taiwan Semiconductor Manufacturing 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!*

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Geoffrey Seiler has positions in Philip Morris International and Pinterest. The Motley Fool has positions in and recommends Pinterest and Taiwan Semiconductor Manufacturing. The Motley Fool recommends Dutch Bros and Philip Morris International. The Motley Fool has a disclosure policy.

After the stunning announcement earlier this week that the U.S. and China are bringing their tariffs back down, the S&P 500 is nearly back to where it started out the year. There's no way to know if it will keep climbing and hit new highs anytime soon or unravel again, but it's a big burst of confidence in the economy.

In the meantime, coffee shop chain Dutch Bros (NYSE: BROS) continues to outperform the market. The growth stock has incredible opportunities as it opens new stores and builds up its presence. However, it's plunged 18% over the past few months. Let's see why the market is spooked and whether or not this is a buying opportunity.

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More coffee, please

Dutch Bros recently celebrated its 1,000th new store opening (this one in Florida), and it concurrently announced plans to open another 1,000 stores by 2029. It doubled its store count from around 500 when it went public in 2021 to where it is today, but it's still a bold statement to imagine doing that again over the next four years. It's planning to open at least 160 stores in 2025, so this ambitious plan implies that the rate is going to accelerate significantly over the next few years.

Customers love the coffee, increasing confidence that it can reach this goal. It provided a further, long-term goal of reaching 7,000 stores. That was raised from its previous goal to reach 4,000 stores, and as it expands successfully, there's certainly a chance that even this goal could be surpassed.

Some recent metrics highlight why investors are so enthusiastic. In the 2025 first quarter, revenue increased 29% year over year, driven by 30 new stores and a 4.7% increase in comparable sales. Some of that was due to pricing, but transactions were also up 1.3%, a good sign of consumer engagement despite higher prices.

How it's winning new business

CEO Christine Barone attributes the success to three factors: innovation, marketing, and the company's rewards program.

Dutch Bros is known for its unique, customized beverages, and specifically for its cold drinks. It's had great success with recent launches like boba and protein coffee, and it recently rolled out a limited-time offer of popular cereal flavors to add to customized drinks. It's also piloting a new food menu in some locations. Food only accounts for 2% of sales right now, but management believes that offering a targeted food menu of specific items can lead to higher beverage sales. This could be a significant addition in capturing share of the all-important morning rush without adding unnecessary complexity for its "broistas." It launched eight new products, including four hot ones, in a pilot test of eight stores. Based on that initial success, it has expanded the program to 32 stores.

Paid advertising is an integral part of how the company is building its brand as it enters new markets. Since it isn't well known outside of its current markets, this is an important strategy to get its name out and create excitement about its products. But it's been equally successful in its more mature markets.

Finally, it's enhancing its rewards program with mobile ordering, and order-ahead is adding a substantial layer to sales. Rewards members accounted for 72% of sales in the first quarter, up five percentage points from last year, and there has been quicker adoption in new markets. Barone expects the rewards program to be a strong growth driver going forward.

Market sentiment or consumer sentiment?

Dutch Bros stock fell along with the rest of the market as investors were worried about a cooling economy if tariffs were raised. Management addressed how tariffs would affect its operations, and it was a confident take, since it estimated that only about 10% of its costs would be impacted. However, that doesn't address the pullback in general consumer spending.

With the new detente in tariffs between the U.S. and China, market sentiment is back up. Although Dutch Bros' costs that are affected, like coffee beans, don't come from China and could still be impacted by tariffs, consumer spending, which was the greater worry, may not be.

Great value on the coffee, but not the stock

Dutch Bros has a strong future ahead, but that comes at a price. Even at the lower price, it trades at a forward, one-year P/E ratio of 85, which is quite a premium. The market sees the tremendous opportunity here and is pricing it accordingly.

If you have a long time horizon, I don't think you'll be disappointed in owning this stock. However, because the valuation is so rich, the stock is susceptible to going lower on any bad news. If you can take that in stride and hold on through the likely bumps along the journey, Dutch Bros is an excellent stock to buy.

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 $635,275!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $826,385!*

Now, it’s worth noting Stock Advisor’s total average return is 967% — 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.

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*Stock Advisor returns as of May 12, 2025

Jennifer Saibil has no position in any of the stocks mentioned. The Motley Fool recommends Dutch Bros. The Motley Fool has a disclosure policy.

Shares of Dutch Bros (NYSE: BROS) were buzzing and popping on Thursday. The coffee chain, famous for its friendly service and drive-thru focus, posted a fresh first-quarter report on Wednesday evening. The results came in well above the analyst community's projections, driving Dutch Bros' stock as much as 10% higher in the morning session. By 12:20 p.m. ET, it had cooled down slightly to an 8.2% overnight gain.

Q1 by the numbers

The average Wall Street analyst had expected adjusted first-quarter earnings of roughly $0.11 per share, based on top-line revenue in the neighborhood of $343.6 million. Dutch Bros' actual earnings landed at $0.14 per share, up from $0.09 per share in the year-ago report. Revenues rose 29% to $355.2 million.

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Management held their full-year guidance targets steady, but noted that many metrics are trending above the midpoint of earlier expectations. In particular, Dutch Bros could see surprisingly strong 2025 results in the categories of total revenues, same-store sales growth, and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA).

Dutch Bros' recipe for thriving in a tough market

CFO Josh Guenser admitted that the macroeconomic situation is unpredictable these days. But the company's exposure to tariff expenses is "limited," with most of the coffee beans it buys coming from low-tariff countries like Brazil, El Salvador, and Colombia. And Dutch Bros has secured its supplies for the rest of 2025 with preorders.

"We have a strong runway ahead and are well positioned to continue producing healthy financial results in this dynamic macro environment," Guenser said on the earnings call.

So Dutch Bros is still an inspiring growth story, despite macroeconomic pressure and rising ingredient prices. The stock trades 27% below February's all-time record price at 166 times trailing earnings. Dedicated growth investors can swallow the lofty valuation and invest in Dutch Bros' seemingly unstoppable growth.

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 $623,103!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $717,471!*

Now, it’s worth noting Stock Advisor’s total average return is 909% — a market-crushing outperformance compared to 162% 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

Anders Bylund has no position in any of the stocks mentioned. The Motley Fool recommends Dutch Bros. 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).

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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?

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 $594,046!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $680,390!*

Now, it’s worth noting Stock Advisor’s total average return is 872% — a market-crushing outperformance compared to 160% 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 21, 2025

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.

Dutch Bros (NYSE: BROS) has quickly become one of the most exciting names in the food and beverage industry. While more prominent players like Starbucks dominate the market, Dutch Bros has carved out its niche with a unique drive-thru model and an intensely loyal customer base.

But what makes Dutch Bros a stock to watch for the long run? Here are three key reasons this fast-growing coffee chain is worth investors' attention.

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1. A well-proven operating model

Dutch Bros isn't just another coffee company -- it has revolutionized the drive-thru coffee experience. Unlike traditional sit-down cafes, Dutch Bros focuses on speed, efficiency, and customer experience, allowing it to serve more customers per hour. Such an approach delights customers and also generates a good return on investment for the company.

Besides, the coffee chain is well known for its customizable drinks, particularly its cold and ice-blended beverages. Personalized beverages align with younger consumers' preferences and differentiate them from competitors. In 2024, cold beverages accounted for 94% of all drinks sold to Generation Z. The company has also moved beyond its early roots of serving coffee-based beverages to other products such as energy drinks and refreshments.

Beyond serving great beverages fast, the food company also focuses on building a loyal customer base. It relies on strategies like excellent customer service, community building via social media, and a loyalty system to reward customers. As a result, 71% of its transactions in the fourth quarter of 2024 went through the loyalty program, up from 44% in the first quarter of 2021.

Its highly efficient operating structure, differentiated product offerings, and loyal customer base explain its solid track record of growth. In the last five years, store count grew by 42% on a compound annual growth rate (CAGR), and revenue expanded by 50%.

2. Great store economics

While many restaurant chains struggle with high overhead costs and long capital payback periods, Dutch Bros stores deliver strong financial performance with an efficient cost structure and fast profitability.

Let's look at some quick numbers. The company expects to spend $1.25 million on capex for each new store in the future, with an expected annual sale of $1.8 million per new store in the second year of operation. With a targeted shop contribution of 30%, the return on investment is around 43%, giving it a payback of just slightly above two years. Note: Shop contribution is defined as gross profit plus depreciation.

Dutch Bros' solid return on investment is not without reason. One thing is that, unlike traditional coffee shops, Dutch Bros stores are smaller and require fewer employees, which keeps operating expenses lower. A low capex and relatively low overhead allow the company to generate strong store-level margins early on.

Besides, the beverage company has a proven track record of delivering same-store sales growth (SSSG) over time. For perspective, stores opened in 2020 and prior delivered 4.6% SSSG in 2024, and newer stores did even better, reaching 13.7% for those stores opened in 2023. SSSG will further enhance the return on investment in older stores.

These factors should sustain Dutch Bros' excellent store economics for the foreseeable future.

3. A great growth story

Dutch Bros has already proven its business model and store economics. The focus is on scaling up and expanding the business into new markets and products.

The company currently has just under 1,000 stores across 18 states. Over time, it expects to add another 3,500 stores in existing states and also expand into other new regions, particularly on the East Coast. In 2025 alone, it plans to add at least 160 stores in existing and new areas. If successful, this latest expansion will quadruple the store count in the coming years.

However, that's just one part of the story. It is actively adding new SKUs to its menu to grow SSSG, particularly focusing on food products. For perspective, Dutch Bros' food sales in 2024 are less than 2% of revenue, much lower than its industry peer, where food accounts for around a quarter of the sales. Expanding its food menu presents a major opportunity for increasing same-store sales.

Another area that could see good growth is the energy drinks segment, which is expected to grow faster than the coffee industry. With around 25 % of its sales from customized energy drinks, Dutch Bros is well positioned to benefit from this trend.

Overall, the food company expects to grow its top line by 20% in the coming years, with new stores growing at a mid-teens growth rate and SSSG in the low digits.

A growth stock to keep on the radar

It is not difficult to see why Dutch Bros could be a great growth stock. It has a proven operating model, solid store economics, and a long growth runway.

Unsurprisingly, the stock doesn't come cheap -- as of writing, it has a price-to-earnings (PE) ratio of 179.

It will be best to keep the stock on the radar and wait for a more reasonable entry price.

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 $495,226!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $679,900!*

Now, it’s worth noting Stock Advisor’s total average return is 796% — a market-crushing outperformance compared to 155% 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

Lawrence Nga has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Starbucks. The Motley Fool recommends Dutch Bros. The Motley Fool has a disclosure policy.

The emergency room series has become a major success for Max, and it just wrapped up its first season on the streaming platform.

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!*

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*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.

The stock market is having a terrible year so far. President Donald Trump's sweeping tariffs have rattled investors and analysts. There is rising fear that an impending global trade war will lead to a global recession.

Some investors have been booking profits in equities and moving toward "safer investments" such as gold and government bonds. This explains why high-flying stocks such as Dutch Bros (NYSE: BROS) saw a significant pullback in the past few weeks.

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 »

The coffee-focused restaurant chain's share prices shot up big time in February following the release of strong quarterly results, clocking gains of more than 60% in just over two months. But Dutch Bros stock is down 37% from the 52-week high it hit on Feb. 18.

This pullback could be an opportunity for savvy investors to add a fast-growing company to their portfolios. Let's look at the reasons why buying Dutch Bros stock right now could turn out to be a smart long-term move.

Dutch Bros' impressive growth seems here to stay

Dutch Bros ended 2024 with annual revenue up 33% to $1.28 billion. The company also reported an impressive increase of 63% in its bottom line to $0.49 per share. This increase was driven by a combination of healthy growth in its same-store sales and the opening of new stores. Dutch Bros increased its new shop count by 18% last year.

What's more, the company-operated shop contribution margin was up by 150 basis points last year (roughly 35% of stores are owned by franchisees), which explains why its earnings grew at a faster pace than its revenue. An important thing to note here is that Dutch Bros managed to expand its margins despite an increase in coffee prices. The company did this by raising prices and by lowering the capital cost of opening each new shop.

Dutch Bros management points out that last year was its "peak per unit capex," which means that it expects the opening cost of each new shop to come down. This should allow it to mitigate the potential effect of an increase in coffee prices due to newly imposed tariffs from the U.S. and elsewhere. The U.S. announced 46% tariffs on imports from Vietnam and a 32% duty on Indonesian imports. Brazil and Colombia were slapped with 10% import duties.

So, there is a good chance that Dutch Bros will continue to see a hike in coffee prices this year. Even then, management forecasts a 17% jump in its adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) this year. Management also expects sales to grow by 22% this year. These numbers are solid, considering the potential effect of higher prices that Dutch Bros will need to pass on to its customers due to a tariff-fueled increase in coffee prices.

This explains why analysts expect a dip in Dutch Bros' earnings growth in 2025. Consensus estimates project a 23% increase in the company's bottom line this year to $0.60 per share. However, its earnings are expected to grow at a faster pace over the next couple of years, as shown in the chart below.

Data by YCharts.

More importantly, Dutch Bros can sustain impressive growth for a much longer period, as it sees a massive opportunity to grow its business in the long run. The company opened its 1,000th shop in February, and it expects to double this count in the next four years. Dutch Bros also sees the potential of opening more than 7,000 shops in the long run.

As such, it won't be surprising to see Dutch Bros become a much bigger company in the long run. That's why investors looking to buy a potential long-term winner right now should take a closer look at this name.

The stock is expensive, but it can justify its valuation

Even though Dutch Bros stock has retreated significantly of late, it continues to trade at a relatively expensive valuation. It's trading at 151 times trailing earnings, and the forward earnings multiple of 83 isn't all that cheap either. However, we have seen that Dutch Bros' earnings growth could accelerate starting next year.

The long-term store opening opportunity is another reason why this company seems built for healthy growth in the long run. All this tells us why it may be a good idea to start accumulating Dutch Bros stock while it is retreating, as the market could reward its accelerating growth with more upside in the future. 14 of the 16 analysts covering Dutch Bros recommend buying the stock, with a median 12-month price target of $82. That would be a 54% jump from current levels. This should give investors another incentive to buy this growth stock, as it seems poised to deliver solid gains in both the short and the long run.

Don’t miss this second chance at a potentially lucrative opportunity

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

• Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $244,570!*
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Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.

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*Stock Advisor returns as of April 5, 2025

Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool recommends Dutch Bros. The Motley Fool has a disclosure policy.

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