Key Points

• Artificial intelligence-powered drug development isn't a mere premise anymore. Recursion Pharmaceuticals has made it a reality.

• The next era of e-commerce favors platforms like Shopify's, which allows brands to connect with consumers outside of massive digital shopping malls.

• U.S. drivers may not be big fans of electric vehicles, but that's not the case everywhere else.

• 10 stocks we like better than Shopify ›

Are Americans saving enough money to fund a comfortable retirement? Probably not. As the Motley Fool's own research indicates, as of 2022 the median retirement savings for U.S. households is a mere $87,000. That means half of the country has saved up more, while the other half has saved less. Even being in the upper half of the crowd, however, isn't necessarily enough.

Committing more of your income to the effort is still only half the battle though. You'll also need to get more out of your money while you're growing your nest egg. This means achieving bigger gains without taking on significantly more risk.

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 »

Here's a closer look at three growth stocks you could buy and hold for decades as a means of supercharging your portfolio's growth. While each of these tickers brings some added risk and volatility to the table that will require regular monitoring, their long-term upside potential is arguably worth the work.

Recursion Pharmaceuticals

While artificial intelligence (AI) still has of room for improvement, the writing is on the wall -- the technology will be tackling complex problems that individuals and institutions just can't. This includes designing and testing pharmaceuticals.

Well, the future is here. Recursion Pharmaceuticals (NASDAQ: RXRX) has built an AI-powered platform capable of virtually testing a drug rather than requiring a full-blown clinical trial of an idea. Leveraging 36 petabytes (36 million gigabytes) of digital biological and chemical data, its so-called Recursion OS can accomplish what would normally take years and millions of dollars in a matter of days at a fraction of the cost.

And it's no mere theory. The technology is not only functioning -- it's commercialized. A handful of pharma companies including Roche and Sanofi are using Recursion OS to tackle some of their own developmental work, while Recursion is working on some drugs of its own. All of these drug candidates will still need to go through the actual clinical trial process to satisfy regulatory agencies like the FDA. Recursion's software facilitates focus though, by virtue of weeding out less promising drug prospects so more resources can be devoted to more promising ones. That's huge.

It's still relatively early for Recursion, and for that matter, the AI-assisted drug-development industry itself. Recursion Pharmaceuticals remains in the red, and will likely remain there for at least a few more years. This arguably makes Recursion the riskiest of the three stocks being put under the microscope here.

Just understand the potential reward is commensurate with the risk. Recursion Pharmaceuticals is nearing a revenue and profit turning point in front of what Straits Research believes will be average annualized growth of nearly 32% for the artificial intelligence drug-development industry through 2030. This tailwind alone should be enough to push Recursion to profitability. That makes this stock's prolonged and persistent weakness since peaking in 2021 is a fantastic buying opportunity.

Shopify

Amazon (NASDAQ: AMZN) is in no immediate danger of being dethroned as the king of North America's e-commerce scene. But it's no longer able to simply bully the rest of the industry. Competitors are successfully pushing back... just not in the way you might have expected. Rather than one or two rival names making inroads, brands and merchants are taking matters into their own hands by setting up their own online stores as a means of working all the way around Amazon's domination.

And they've largely got Shopify (NASDAQ: SHOP) to thank for the option.

In simplest terms, Shopify helps companies establish their own in-house e-commerce presence. From websites to payment-processing to inventory-management to marketing, Shopify can do it all, making it easy for businesses of all sizes to stay focused on more important matters (like running that business). Although the company no longer discloses how many clients are using its technology, it does divulge the scope of its business. Last year, Shopify's solutions facilitated the sale of $292.3 billion worth of goods and services, up 24% year over year to extend a long-established growth streak. Shopify collected $8.9 billion worth of revenue for itself in the process, turning a little over $1 billion of it into net income.

SHOP Revenue (Quarterly) data by YCharts

This growth still only scratches the surface of the opportunity though. Market research outfit eMarketer reports that only a little more than one-fifth of the world's retail spending is currently done online. The rest is still taking place in brick-and-mortar stores.

While certainly some of these sales will never move online, much of it can. Brand-owned and merchant-managed online stores are positioned to capture more than their fair share of whatever growth awaits the e-commerce industry, however, as these players increasingly see the value in establishing their own direct relationships with customers. In this vein, analysts expect Shopify to produce top-line growth in the ballpark of 20% in each of the three years ahead.

Nio

Finally, add Nio (NYSE: NIO) to your list of stocks to buy and hold for decades if you want a shot at building a bigger retirement nest egg.

It wouldn't be surprising if you'd never heard of it. Although it's finding a bit of traction in Europe, the Chinese maker of electric vehicles predominantly serves China itself. It delivered 72,056 electrified cars during the second quarter of this year, up nearly 26% from the year-ago comparison, underscoring production growth that's been in place for some time now.

Think the electric vehicle (EV) market is hitting a wall due to disinterest? Not so fast. That's largely an American phenomenon. Data gathered by CleanTechnica indicates sales of electric vehicles in China soared 25% to 1.1 million units last month, accounting for more than half of the country's entire automobile sales.

That's still just the beginning though. The International Energy Agency expected EVs to account for 80% of China's total car sales by 2030, thanks to supportive policies that encourage the alternative to combustion-powered vehicles. It's making inroads in Europe as well, for the same reason. And, while there's little incentive for the company to make a push into the United States' anemic EV market right now, if and when domestic interest perks up, Nio has maintained tentative plans for that possibility.

It could be a while before Nio works its way out of the red and into the black -- it simply needs more scale. This could make the stock a little less than completely comfortable to own in the interim.

It's making clear progress on the production as well as the profitability front though, and will almost certainly get there sooner or later, and likely sooner. Given how inevitable this outcome now seems, the market's apt to reward the progress en route to fiscal viability.

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 $636,628!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,063,471!*

Now, it’s worth noting Stock Advisor’s total average return is 1,041% — a market-crushing outperformance compared to 183% 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

James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon and Shopify. The Motley Fool recommends Roche Holding AG. 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 »

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.

Key Points

• Solana could draw in more developers with the speed of its transactions.

• Cardano's recent ecosystem upgrades could make it a lot more useful.

• XRP could gain momentum as a bridge currency for cross-border transfers.

• 10 stocks we like better than Solana ›

Many investors flocked back to cryptocurrencies during the past year as lower interest rates made speculative investments more attractive again. Earlier this month, I said the two big blue-chip cryptocurrencies -- Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH) -- were still great places to park $1,000 for a few decades.

But today, I'll take a look at three riskier cryptocurrencies -- Solana (CRYPTO: SOL), Cardano (CRYPTO: ADA), and XRP (CRYPTO: XRP) -- that could also have a bright future. While they might be a bit riskier than Bitcoin or Etherereum, they might be worth a more modest $500 investment.

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 »

Solana

Solana's blockchain blends together the energy-efficient proof-of-stake (PoS) consensus mechanism used by Ethereum with its own proof-of-history (PoH) mechanism. That combination gives it a theoretical top speed of 65,000 transactions per second (TPS), compared to Ethereum's theoretical maximum speed of just 30 TPS. In real world transactions, which are limited by network congestion and other factors, Solana has a daily average speed of over 1,400 TPS -- compared to Ethereum's average speed of 19 TPS.

As a PoS blockchain, Solana supports the development of decentralized apps (dApps) and other crypto assets through its smart contracts. Since it's faster than Ethereum and other PoS blockchains, it's becoming a popular platform for building decentralized finance (DeFi) apps and non-fungible tokens (NFTs). Visa, Shopify, and other companies have also integrated Solana Pay (its peer-to-peer payment protocol for accepting stablecoins, Solana, and other Solana-based tokens) into their own digital ecosystems.

Solana is an inflationary token with no maximum supply, so it can't be valued by its scarcity like Bitcoin. But the growth of its ecosystem could gradually boost its value. Artemis Analytics estimates that Solana only serves about 1.5 million daily active users (DAUs) today, but VanEck thinks it could eventually rise to more than 100 million DAUs in the next five years in a bull case scenario. We should take that rosy outlook with a grain of salt, but Solana could still have plenty of room to grow.

Cardano

Cardano, which was created by Ethereum co-founder Charles Hoskinson, is another PoS blockchain that supports the development of decentralized apps. Like Solana, Cardano is faster than Ethereum with a daily average speed of about 250 TPS. By deploying its new "hydra heads," which process some of its transactions off-chain to alleviate the congestion on its main blockchain, it aims to achieve average speeds more than 1,000 TPS.

The deployment of those heads could make Cardano a more popular platform for the development of DeFi, gaming, and enterprise apps. Its new Mithril protocol, which aggregates all of the data across its blockchain into a single compressed index -- should further improve its accessibility for users and developers. It also recently enabled the transfer of Bitcoin assets on its own blockchain, and that upgrade could draw more Bitcoin-backed stablecoins to its ecosystem and support the growth of its DeFi apps.

Cardano is an inflationary token, but its speed and recent upgrades could make it a more attractive platform for developers. Assuming that happens, its price might stabilize and rise over the next few decades as it catches up to blue-chip cryptos like Bitcoin and Ethereum.

XRP

XRP is a cryptocurrency created by the founders of the fintech company Ripple Labs. Its entire supply of 100 billion tokens was mined before its launch in 2012, and Ripple sold those tokens to fund its own expansion. Those sales caught the attention of the Securities and Exchange Commission (SEC), which sued Ripple for allegedly selling unregistered securities. Those lawsuits dragged on until last year, when a court slapped Ripple with a lighter-than-expected fine and ruled that XRP wasn't an unlicensed security when sold to individual investors.

That mostly favorable ruling drew back a stampede of bulls. XRP was relisted on the major crypto exchanges, Grayscale relaunched its XRP Trust as a closed-end fund (CEF), and several crypto firms submitted their applications for XRP exchange-traded funds (ETFs). But looking beyond that near-term boost, XRP still has other irons in the fire.

Ripple is promoting the usage of XRP as a bridge currency to speed up foreign currency transactions (by temporarily converting both currencies into XRP) at lower fees. It also launched pilot programs with several central banks to use XRP to bridge the liquidity between their national central bank digital currencies (CBDCs), and it recently applied for a U.S. banking license, which would enable it to integrate XRP into more cross-border transfers. To make it more relevant with developers, it's been adding support for lightweight smart contracts (mainly used for payments instead of apps) to its blockchain. The rapid expansion of that ecosystem could drive XRP's price higher during the next few decades.

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

Before you buy stock in Solana, 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 Solana 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 $652,133!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,056,790!*

Now, it’s worth noting Stock Advisor’s total average return is 1,048% — a market-crushing outperformance compared to 180% 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 15, 2025

Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bitcoin, Ethereum, Shopify, Solana, Visa, and XRP. The Motley Fool has a disclosure policy.

The latest edition of the 'Warhammer 40K' prequel spinoff no longer specifies the 'hormonal and biological make-up' of gender in the process of creating Space Marines, leaving room for fandom interpretations that have existed for many years.

In this podcast, Motley Fool contributors Tyler Crowe and Matt Frankel discuss:

• Taiwan Semiconductor's most recent earnings report.
• The torrid pace of AI spending.
• Lower mortgage rates are taking the cork off existing home sales and refinancing.
• Insulation contractor TopBuild now does roofs.
• Ferrero will acquire WK Kellogg.
• Two stocks worth watching this earnings season

To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. When you're ready to invest, check out this top 10 list of stocks to buy.

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 »

A full transcript is below.

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 $680,559!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,005,670!*

Now, it’s worth noting Stock Advisor’s total average return is 1,053% — a market-crushing outperformance compared to 180% 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 15, 2025

This podcast was recorded on July 10, 2025.

Tyler Crowe: Taiwan Semiconductor's earnings say full steam ahead for AI, and the housing market is getting some of its best news in a while. You're listening to Motley Fool Money. Welcome to Motley Fool Money. I'm Tyler Crowe, and joining me today is Motley Fool analyst Matt Frankel. Matt, thanks for being here.

Matt Frankel: Thanks for having me. It's always fun to be on with you.

Tyler Crowe: We do a lot of conversations. Offline and doing one here is going to be great. On today's show, the snacking industry is actually coming for the breakfast aisle. The housing market saw its first green shoots in a while. There's merger talk in the building supply industry, and Matt and I are going to give some earnings watches for the upcoming quarter. But we're going to start today's show with Taiwan Semiconductors because they just released their second quarter or June earnings earlier today. Taiwan Semiconductor manufacturing's revenues rose about 39% in the quarter, and TSMC CEO C.C. Wei said that AI chip demand still, they think is outstripping the current supply that they have, and the company has pledged to spend $100 billion ramping up manufacturing. Now, Matt, I'm probably not alone in being flabbergasted, every time I hear a projection about spending and CapEx related to AI. NVIDIA just passed the four trillion dollar market cap threshold a couple days ago, and it's still hard to wrap my head around. I think the easy question is, will AI spend, continue to grow? I think that's a little too easy. I want to ask you, do you see AI CapEx spending continuing at this rate?

Matt Frankel: Well, a 40% year over year growth rate is only sustainable for so long. This is an acceleration. It's worth mentioning. Last year, in 2024, Taiwan Semi reported 30% year over year revenue growth. This is a pretty big acceleration after an already very strong year. I think over the past 30 years, Taiwan Semi's revenue's grown at about 18% annualized rate. It's really picked up in the past couple of years because of all this AI spending. This is a massive business, especially for one that doesn't make any of its own products. It makes products on behalf of other companies. All of their customers, just to mention some on their customer list, Apple is their biggest one. But they also make chips for NVIDIA, AMD, Broadcom, Tesla there are a lot of companies they make chips for on a third party basis, and these are deep pocketed companies that are all committing a lot of money to AI investment. When you ask will this continue if you're asking over the next five years, I could see that growth rate actually being sustained. But if you're asking beyond, at some point, we're going to hit a peak, but I don't think we're there just yet.

Tyler Crowe: The interesting thing is a lot of the companies I follow are like in the construction industry related to AI, like all the electrical supply contractors and the builders and things like that. Their backlogs for AI data centers and all that stuff is still growing at really large rates. Their remaining performance obligations, their word for backlogs, have been growing at similar rates, which is also, to me, a leading indicator for a lot of this because you got to build the data center before you can put any chips in it. Beyond the same thing, beyond the five years, it starts to get really murky because we're 40% for five years straight is a lot, but certainly over the next 2-3 year window, it doesn't seem unrealistic to continue to keep doing this.

Matt Frankel: One of the really good ways to get ahead of demand is to look at what the data center industry is doing, and I'm glad you brought up building for that reason because so many data centers are being built right now. There's a lot of if you look at, Digital Realty Trust or Equinix's, construction activity, there's a lot going on, and it creates like a forward looking projection, if you will, because, the company will order a new data center, start building it. At some point later, it's going to be filled with chips and things like that. That's a really good forward indicator of how demand is doing.

Tyler Crowe: Let's put the rubber of the road here really quick regarding Taiwan Semi. It's a recommendation in the Hidden Gems dividend service and several other molecule services. After seeing these results and the current valuation that we're looking at for Taiwan Semi, do you still see the stock as a buy?

Matt Frankel: Given how quickly its revenue is growing, it trades for about 24 times forward earnings, there's not a lot to dislike about this company. That 1.2 trillion dollar valuation sounds high, but it really isn't when you look at how the business is doing.

Tyler Crowe: If we're looking at these numbers for 2, 3, 4 years, a company can grow into a 26 times forward earnings valuation or forward earnings valuation pretty quick. It's hard to see it being an awful investment from here at current valuations. Next up, mortgage rates are on the decline, and the housing market is responding quick.

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Tyler Crowe: The housing market has been looking for something, anything resembling good news lately. Finally, it got a little bit. The average rate for a 30 year mortgage in the United States has declined five weeks in a row, and it's now down to 6.77%. Now, that certainly isn't the sub 3% mortgages that we saw in the 2021 period, but it is a nice improvement from the greater than 7% mortgage rates we've seen so far this year, and I know I have been like mortgage rate shopping for quite some time. Matt, the housing market appears to be taking advantage of this situation much faster than we've seen other mortgage rate movements lately, and something you've been following is like housing volume is really picking up because of this.

Matt Frankel: You mentioned the other mortgage rate moves. This isn't the first time we've seen mortgage rates cool off from the highs, which is why this move is a surprise to a lot of people. Mortgage rates peaked at about 8% when inflation was really high. But even they've come down a little bit, then they go up, then they come down, they go up, and they have oscillated between 7.5% and like six and three quarters in recent times. All the other times it's happened, this is a key difference. All the other times it's happened, there hasn't been a lot of housing inventory. Now that's changed. There's a lot more inventory on the market with this decline. People who want to buy houses are taking advantage, just to name some of the statistics just last week alone, week over week, application volume was up more than 9%. Refinancing is 56% higher than it was a year ago. People who got mortgages in the 8% range are finding it valuable to refinance right now. Purchase applications are up 25% year over year on a seasonally adjusted basis. The numbers really look surprisingly strong, given that, you know, over the past week, the average mortgage rates down two basis points. It's not like it's been a sharp decline in the past week, but now buyers are suddenly coming into the market.

Tyler Crowe: Following the housing move for the past couple of years, it's been trying to poke somebody a stick and say, Come on, do something and it's funny to actually see it finally happening. Part of me wonders if it's a little bit mortgage and also our mortgage rates, excuse me, and a little bit of just like the people have been putting it off and using this as that time to start taking the lid off, especially with the buying season here in the spring and summer. Now, you and I and a couple other people, longtime Motley Fool contributors, analysts. We spend way too much time talking about housing, investing in housing, investing in real estate. There's some side channels that get a little unhinged. But with mortgage rates are declining, the probability of a rate cut actually looks to be in sight something that I have been hesitant to say for quite some time. There is pent up demand for homes. Matt, with this backdrop, what stocks in this particular market look interesting to you?

Matt Frankel: I've been saying the Home Builders forever, and so have you, but it's really tough to gauge the dynamics of Home Builders when existing homes are becoming more appealing than they had been for a long time. I won't say that. I'm really looking at rocket right now, RKT the largest lender. They're a very profitable company. I think refinancing in particular is a big opportunity. I mentioned refinancings up 56% year over year, and that's because rates fell to 6.77%. Imagine if rates fall to 6% or 5% in the next couple of years, Americans are sitting on $35 trillion in home equity that's the most ever, and a lot of it's just waiting to be tapped. A lot of people want to do big projects, but won't because it's expensive.

Tyler Crowe: Actually, the Refi number was the one that really stood out to me, as well. I didn't go to the mortgage originators, like Rocket. I actually went to the home repair and remodel industry because, again, this is everyone stared at their walls in 2020, 2021, did all those projects, and now it's been like three or four years. Everyone's starting to get that itch to do projects again and lower mortgage rates. A refinancing is a good opportunity to that. I've been looking at companies like Home Depot that have underperformed just about the time the interest rates started to climb a few years ago, we had that big pull forward in remodel activity and things like that. Home Depot and a lot of other building supply companies, and one company in particular is TopBuild. It's an insulation distribution and installation contractor specifically for insulation. That company just so happens to be the company we're going to be talking about next. Continuing on our theme of the housing market, home repair, building products, there's a company Top bill. They just mentioned it as a distribution installation contractor. They recently announced it's going to acquire Progressive Roofing. Matt, can you just give a quick breakdown of what this deal looks like?

Matt Frankel: Progressive Roofing, as the name implies, they're one of the largest commercial roofing installers in the United States. They make about 70% of their money from what's called reroofing, which is people like me needing a new roof and maintenance and 30% from new construction homes, both of which can get pretty nice tailwinds, if the real estate market keeps going as it's going. The deal is it's $810 million in cash. It looks like a great deal for TopBuild if if the market heads in the right direction. That's about nine times progressives EBITA over the past 12 months. They expect there to be some synergies, like whenever you acquire two businesses that have some overlap, you can usually combine some operations and things like that and get some cost savings. It looks like a strong acquisition. They're going to have to take on debt to do it. TopBuild has about 300 million in cash right now. Another roughly half a billion dollars will need to come up with through debt, but they have a really healthy balance sheet, about 1.4 billion in debt with $11 billion market cap business and highly profitable. I like this deal. I think this is not the last consolidation we're going to see in the industry in 2025.

Tyler Crowe: We've seen some more splashy things when it comes to acquisitions here. Brad Jacobs of XPO Logistics and United Rentals and a bunch of other we'll call it the boring economy guy who rolls up companies is getting into building supplies with QXO. It seems to be a hot activity lately as mergers acquisitions roll ups in this industry. TopBuild as I said, installation of insulation the real dirty work. Anybody that's done contracting work knows that insulation stinks as a job to do. But it's been a spectacular investment after it got spun out of Masco Corporation in 2015, several Motley Fool recommendation services. You and I have been following this company in this industry for quite a while. For TopBuild, much of its success has come from rolling up those small distributors and installation contractors across North America. It's been their calling card is going and buying out mom and pops who are maybe coming to the end of their time of wanting to run a business or some small regionals that success story of Bolt-on acquisitions. Now, roofing isn't insulation. Honestly, I'm a little anxious when a company makes an acquisition that is slightly tangential to what they're doing. Am I being a little too apprehensive here, because, I do tend to be a little bit more nervous than you.

Matt Frankel: Well, insulation and roofing are related parts of the building process. It's not like they're an insulation company, and they're acquiring a concrete manufacturer or something like that. It's a very related part of the business. But I do get your point. Some of the synergies I mentioned come from the fact that there's a lot of overlap in the processes. You generally don't put in a new roof without checking your insulation at the same time. There is a lot of overlap here. But no, I definitely get your point when companies start to step outside of their wheelhouse a little bit. It'll be worth watching, but it looks like the price is right, so they have some wiggle room to have a learning curve in there, if you will.

Tyler Crowe: I'm probably a little too nervous by nature, but I do have to admit, as I've looked at this deal, I think overall, we can talk about the business stuff. But more importantly, for me, I think management has developed enough of a track record that I'm willing to give them the benefit of the doubt right now or tie goes to the base runner, I guess, if you will. With the refinance market picking up so could activity in the roofing business along with installation. It might be a good time to be making this acquisition. Speaking of M&A, we're going to move on to our next store here, which is going from roofing to the breakfast aisle because that seems to be getting a hot market that also just happens to be getting a little bit sweeter. Earlier today, Ferrero Rocher or Ferrero International, the Italian private company has agreed to acquire WK Kellogg for about an enterprise value of 3.1 billion. WK Kellogg, of course, was the cereal business that was split out of Kellanova I believe it was either last year or a couple of years ago. It was a relatively recent split for the two companies where Kellanova wanted to focus on the snacking industry. WK Kellogg was going to take the cereals.

But Ferrero Rocher is very much a candy company, and it's interesting to see them going in this direction. It's about $23 per share for WK Kellogg in cash. About 31% premium Keeling's closing price today. Matt, what did you actually think about this deal? I know it's hard to really put a pin on private companies, especially an Italian one. We don't seem to have a lot of information on private Italian companies here in the US public markets. But we've seen tons of M&A activity and flirting with M&A activity. We saw Mondelez and Hershey talking about getting together early or late last year. Do you have any insights as to why you think there's so much talk and commotion in particular in the package food industry lately?

Matt Frankel: Well, in this particular case, there's a couple key takeaways. One is that Ferrero has been building out its US portfolio for some time. They acquired all of Nestle's US candy business a couple of years back, for example. You might have some of their products in your house right now and not know it. It's summertime. A lot of people keep those bomb popsicles in their fridge. That's a Ferrero product. They have a lot of brands that are very well known to Americans. Second, and this goes more to the broad package food industry that you were talking about. The definite trend is to not only diversify your product portfolio, but diversify it in a way toward healthier products. Now, I know a lot of Kellogg cereals, frosted flakes are not health food, but things like Kashi and raisin bran and rice krispies. We've seen a lot of the companies that specialize in sweets, like Coca-Cola, Pepsi, really diversifying to not necessarily health foods, but to more healthy brands that are that consumers seem to want more nowadays than their traditional products. I think it's a diversification maybe anticipate some changing tastes in the market to insulate themselves from being just a sweets company. That's a common trend that we've been seeing throughout the packaged food industry.

Tyler Crowe: Seems like it's an industry that has been struggling with debt, with trying to figure out a lot of what they're doing with their maybe some brands that are getting a little stale, trying to do some refreshes at the same time. For a lot of these snacking companies, really high cocoa prices haven't exactly helped them along the way when it comes to trying to make a lot of this work. A lot of dividend stalwarts have been really, I would say struggling to really grow the business, and we've seen it in their valuations of late. Honestly, with the package food company industry, I don't know if I'm that interested in any stocks right now, but it's certainly much more fascinating to watch with a lot of these portfolio reshufflings. Is there anyone in particular that is on your radar?

Matt Frankel: I honestly think Pepsi and Coca-Cola are the two standouts in the industry still and have done the best job of adapting to changing tastes over time out of all the package food companies. I'd probably give it to Pepsi because they have a lot more food than beverage.

Tyler Crowe: On our way out here, let's take a quick 30 seconds. Second quarter earnings is coming up. What are you watching?

Matt Frankel: Well, banks are the obvious answer just because they're reporting first, but they're also a really good proxy for just general consumer health. By looking at things like loan defaults, by looking at, trading volume trends, how volatile things have been there. There's a lot you can tell from bank earnings that have implications on pretty much every other company in the United States. That's really what I'm watching next week. Prologis is another company that reports early that we've talked about that is on my radar. They say they're nearing an inflection point. I want to see if we're there yet.

Tyler Crowe: This quarter, I'm actually going to be watching Home Depot for a lot of the reasons that we mentioned when we're talking about mortgage rates. Less for the actual earnings, but I really want to dive into the earnings transcript and see if some of this activity that we just talked about with Refi is translating into increased demand. If management thinks that this is a continuing trend or a little bit of a short term blip that we've been hoping would actually last longer than a couple of quarters here with the mortgage market. Matt, thank you so much for joining me today on Motley Fool Money. As always, people on the program have interest in the stocks they talk about and the Motley Fool may have formal recommendations for or against, so don't buy or sell stocks based solely on what you hear. All personal finance content follows Motley Fool editorial standards and are not approved by advertisers. Advertisements or sponsored content are provided for informational purposes only. See our Fool advertising disclosure. Please check out our show notes. I'm Tyler Crowe. Thanks for listening. We'll see you tomorrow.

Matt Frankel has positions in Advanced Micro Devices, Digital Realty Trust, Prologis, and Shopify and has the following options: short January 2026 $135 calls on Shopify. Tyler Crowe has positions in Prologis. The Motley Fool has positions in and recommends Advanced Micro Devices, Digital Realty Trust, Equinix, Hershey, Home Depot, Nvidia, Prologis, Shopify, Taiwan Semiconductor Manufacturing, Tesla, and TopBuild. The Motley Fool recommends Broadcom, Nestlé, WK Kellogg, and XPO and recommends the following options: long January 2026 $90 calls on Prologis. The Motley Fool has a disclosure policy.

Shares of Shopify (NASDAQ: SHOP) were moving higher today in line with a number of growth stocks in a day with broad gains across the market.

The e-commerce software company seemed to benefit from favorable comments from Fed Chair Jerome Powell about lowering interest rates. Additionally, stocks rose on news of a ceasefire between Iran and Israel, though that seemed to have less of a direct effect on Shopify.

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As of 3:21 p.m. ET, the stock was up 4.6%. At the same time, the Nasdaq Composite was up 1.6%.

Shopify gets a boost

There was no company-specific news out on Shopify, but as an e-commerce software company with a high valuation, Shopify is sensitive to the macroeconomic cycle, including interest rates.

On Tuesday, Fed Chair Jerome Powell said in remarks before Congress that rate cuts could come "sooner rather than later," though he stressed that the central bank could wait to see how tariffs play out.

In its "dot plot" forecast last week, the Fed maintained its prediction that it would cut the Fed funds rate by 50 basis points over the remainder of the year, the same forecast it made earlier this year, meaning investors should expect two 25 basis-point cuts in the remaining four meetings.

That's good news for Shopify as rate cuts should lower the discount rate in the discounted cash-flow valuation investors use to value stocks like Shopify. Lowering the discount rate increases Shopify's valuation.

What's next for Shopify

With its legions of small-business sellers, Shopify is at risk from higher tariffs, but the company offered strong guidance in its first-quarter earnings report, calling for mid-20s revenue growth rate and a free-cash-flow margin in the mid-teens.

If it can maintain those numbers, the stock should continue to rise over the long term.

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 $676,023!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $883,692!*

Now, it’s worth noting Stock Advisor’s total average return is 793% — a market-crushing outperformance compared to 173% 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 23, 2025

Jeremy Bowman has positions in Shopify. The Motley Fool has positions in and recommends Shopify. The Motley Fool has a disclosure policy.

Cathie Wood kicked off the new trading week with one of her busiest shopping days of 2025. The CEO, co-founder, and ace stock picker at Ark Invest added to 15 of her existing stakes -- including Advanced Micro Devices (NASDAQ: AMD), Shopify (NASDAQ: SHOP), and Taiwan Semiconductor Manufacturing (NYSE: TSM) -- in her largest exchange-traded fund on Monday.

She sold only one stock in that aggressive growth fund, paring back her position in Circle Internet Group (NYSE: CRCL). Circle is the stablecoin issuer that also happens to be the market's hottest stock this month. She has now sold shares of Circle in four of the past six trading days.

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Let's get back to Wood's shopping list. If Wood is buying more Advanced Micro Devices, Shopify, and Taiwan Semiconductor, then they're wroth a closer look.

1. Advanced Micro Devices

2. Shopify

No one can take away Shopify's status as a classic growth stock, but it's an investment that has also meandered if you choose the right starting lines. Shopify is up just 20% over the past five years, clocking in with a modest 3% rise so far in 2025. But the e-commerce platform operator is faring better as a business.

Shopify has delivered at least a dozen consecutive years of better-than-20% annual revenue growth, and this year is off to a strong start. Its 27% year-over-year revenue increase through the first three months of this year is its healthiest top-line growth for the first quarter in four years. Its guidance in May calls for another year of growth north of 20%. It also sees its free cash flow margin sticking to the impressive 15% it scored in the first margin for the balance of the year.

Should you invest $1,000 in Advanced Micro Devices right now?

Before you buy stock in Advanced Micro Devices, 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 Advanced Micro Devices 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 $676,023!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $883,692!*

Now, it’s worth noting Stock Advisor’s total average return is 793% — a market-crushing outperformance compared to 173% 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 23, 2025

Rick Munarriz has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices, Shopify, and Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy.

Although it may be counterintuitive, it makes sense to buy stocks when they're down. Getting a great deal can lead to huge gains that you might not see if a stock is overpriced.

There are several caveats to that, though. Most importantly, it only works if you can find amazing stocks that you can be confident about. Stocks that are falling because there's trouble on the horizon could be value traps.

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 »

If you're looking for top stocks that are down right now but could soar soon, Shopify (NASDAQ: SHOP), SoFi Technologies (NASDAQ: SOFI), Revolve Group (NYSE: RVLV), Nu Holdings (NYSE: NU), and RH (NYSE: RH) are excellent choices.

1. Shopify: 37% off highs

Shopify is a leader in e-commerce, but it doesn't sell products; it sells e-commerce services like websites and payment processing. It has moved from a model catering to small businesses to a full-service commerce model with components and packages to meet demand at every stage and size.

It's growing rapidly as well as becoming highly profitable. In the 2025 first quarter, revenue increased 27% year over year, and operating income was up 136%. It's benefiting from the organic tailwinds of increasing e-commerce sales, and it has other growth drivers in launching new features and expanding internationally.

Shopify stock fell when pandemic-fueled growth began to decelerate and it built out too quickly before demand dropped. It's gotten itself into great shape, though, and it's likely to surpass its previous highs and climb higher.

2. SoFi: 40% off highs

SoFi is an online bank that's growing quickly, attracting new members at high rates and becoming profitable. Adjusted net revenue increased 33% year over year in the first quarter, and it added 800,000 new members. The low-cost, fee-based financial services segment increased 101% over last year, and that's boosting profits. Adjusted earnings per share (EPS) were up from $0.02 last year to $0.06 this year in the quarter.

The company has expanded from its roots as a loan business, and that's helping protect it while interest rates have been high. But the loan business is improving, too, with lower default and delinquency rates in the first quarter.

SoFi stock soared to astronomical valuations when it went public in a strong bull market, and it couldn't sustain its unreasonable levels when inflation hit and interest rates were raised. But it's rallying now, and it has incredible long-term opportunities.

3. Revolve: 76% off highs

Revolve sells clothing, shoes, and accessories on its fashion websites, and it uses artificial intelligence (AI) to drive sales and savings. It works with celebrities and social media influencers to reach its target audience of young, stylish shoppers, and it has developed a robust digital presence and loyal following. Sales had been declining when inflation was climbing, but active customers and orders placed have continued to rise, and sales and profits are climbing again. In the first quarter, sales increased 10% year over year, while net income rose 5%. As usual, active customers increased, 6% year over year, and total orders placed were up 4%.

As more companies start to imitate its digital, AI, and social media model, Revolve has a first-mover's edge. When the economy is in a better place, Revolve is well positioned to thrive.

4. Nu: 23% off highs

Nu is an all-digital bank and financial services company operating in Brazil, Mexico, and Colombia. It is a leader in disrupting the traditional banking sector in its region, and it's bringing in customers at a rapid pace. It already has more than half of the adult population in Brazil as members, but it's still adding new ones to the tune of about 1 million monthly, and this is in part because it has gone beyond its original core customers who couldn't access the banking system, which has high barriers to entry, and it's now targeting a more affluent consumer base. As fast as it's growing in its hometown of Brazil, it's growing even faster in Mexico and Colombia, and it sees international expansion down the line.

It reports high growth every quarter, with a 40% sales increase year over year in the first quarter. Net income increased 74% to $557 million, and the interest-earning portfolio was up 62%.

Nu fell earlier this year when investors were worried about high inflation and instability in Brazil, and on the news that Buffett sold out of it. But it's back in favor with the market because it doesn't have exposure to U.S. tariffs, and there's massive long-term potential.

5. RH: 74% off highs

RH is a luxury furnishings retailer, but it's styling itself these days as a global luxury brand. It has a small list of global galleries, most of which are in affluent cities in the U.S., but it's been expanding with stores in the United Kingdom and other large European cities. It also owns several restaurants and offers "experiences" like a guesthouse and yacht rentals.

It has a fair amount of resilience since it targets an upscale crowd, but even that hasn't been able to pull it through inflation without damage as consumers put discretionary items on hold. However, it might be on the rebound. It reported solid results in the 2025 fiscal first quarter, including a 12% year-over-year increase in revenue and a 7% adjusted operating margin.

It may take time for RH to get back to its previous highs, but as it turns a corner, now looks like a good time to buy.

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 $664,089!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $881,731!*

Now, it’s worth noting Stock Advisor’s total average return is 994% — a market-crushing outperformance compared to 172% 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 23, 2025

Jennifer Saibil has positions in Nu Holdings and SoFi Technologies. The Motley Fool has positions in and recommends Revolve Group and Shopify. The Motley Fool recommends Nu Holdings and RH. The Motley Fool has a disclosure policy.

Popular themes on Wall Street today include artificial intelligence (AI), the market for weight management medicines, and the potential impact of tariffs on broader equities and the economy. In 10 years, there will probably be a different set of trending topics on The Street, but those changes won't stop the market from delivering competitive returns over the next decade.

Those who want to cash in on that can purchase exchange-traded funds (ETFs) that track the performance of some major index, or invest in individual companies that are likely to perform better than the market in the next 10 years. For those opting for the second method, two great picks are Shopify (NASDAQ: SHOP) and Vertex Pharmaceuticals (NASDAQ: VRTX).

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 »

1. Shopify

It's been 10 years since Shopify went public. In that time, the company has crushed the market, although it's been a bit of a volatile ride. While a lot has changed since 2015, Shopify's basic investment thesis remains the same: It is a leader in its niche of the fast-growing e-commerce market and boasts a strong moat.

Let's unpack that a little more. Shopify helps merchants build and customize online storefronts.

It offers them practically everything they need to run their stores, including inventory management, payment processing, the ability to cross-sell across social media websites, and much more. At the end of 2024, Shopify commanded more than 12% of the U.S. e-commerce market by gross merchandise volume.

Shopify's competitive edge comes from at least two sources: switching costs and network effects. Since merchants spend a significant amount of time building online stores on the company's platform and doing the necessary marketing work to attract clients, they won't want to switch and risk disrupting their day-to-day operations. That means Shopify is likely to keep most of its clients.

Elsewhere, the company has an app store with thousands of options that help merchants customize their websites. The more developers seek out the company's app store for their creations, the more attractive it is to merchants.

Turning to Shopify's long-term opportunity, the e-commerce market is on a growth path since it grants merchants a far larger pool of potential consumers, and vice versa. But more than 80% of retail transactions still happen offline, even in the U.S.

All these factors paint a bright picture for Shopify's future. Some might point out that the company still isn't profitable or that its forward price-to-sales multiple of almost 13 is more than six times higher than where the undervalued range starts, usually at 2 and under. However, Shopify has made significant changes to its business in recent years, which have helped boost its margins, including eliminating its expensive logistics business. The company should become consistently profitable within a few years.

Lastly, the stock is worth a premium considering its prospects. Although it may be volatile in the short term due to its rich valuation metrics, Shopify should deliver superior returns over the next decade. That's why the stock is a buy today.

2. Vertex Pharmaceuticals

Over the past year, Vertex Pharmaceuticals, a leading biotech, dealt with clinical setbacks and illegal copies of some of its medicines in Russia, which led to lower sales than it expected. Further, one of the company's newer approvals, Casgevy, still isn't generating much in revenue, despite first earning the green light in late 2023.

Casgevy is a gene-editing treatment for a pair of rare blood diseases. Gene-editing therapies are notoriously complex to administer, which is why it's taking a long time to ramp up revenue for this product.

Even so, Vertex Pharmaceuticals looks attractive. It is still the only game in town for patients with cystic fibrosis (CF), a rare lung disease. Vertex is the only biotech that has cracked the code so far, and it manufactures medicines that target the underlying causes of this condition, rather than just its symptoms.

Vertex's success in the CF field should continue to drive top- and bottom-line growth. Elsewhere, the company can count on other newer approvals.

In January, the U.S. Food and Drug Administration gave the nod to Journavx, the first oral non-opioid pain inhibitor. Even without potential label expansions, this medicine can achieve some decent success, considering there is a high unmet need for new, non-opioid pain treatments. According to some estimates, it could generate $2.9 billion in revenue by 2030.

The company should also continue expanding its lineup. It plans on sending applications for Zimislecel, a potential treatment for type 1 diabetes, to regulators next year. The drugmaker has several other promising early- and late-stage programs. Between Vertex's strong CF franchise, the multiple new products it is launching, and its solid pipeline, the stock should deliver superior returns through 2035.

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 $658,297!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $883,386!*

Now, it’s worth noting Stock Advisor’s total average return is 992% — a market-crushing outperformance compared to 172% 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 9, 2025

Prosper Junior Bakiny has positions in Shopify and Vertex Pharmaceuticals. The Motley Fool has positions in and recommends Shopify and Vertex Pharmaceuticals. The Motley Fool has a disclosure policy.

Shopify (NASDAQ: SHOP) has been a massive winner over the last decade, delivering a mind-blowing 3,664% return (as of writing) since going public in 2015.

While long-term investors have benefited enormously from this rise, potential investors wonder if Shopify is a worthy stock to add to their portfolio today.

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 »

This article aims to explore the opportunities and risks associated with owning the stock over the next few years, helping investors make an informed decision.

Bull case:

Shopify has been an unusual company, as it competes against Amazon in the competitive e-commerce industry, yet has remained hugely successful over the last decade -- the secret lies in Shopify's unique business model.

As a start, Shopify is a software-as-a-service company focusing on enabling merchants to sell their products anywhere and everywhere. So the idea is that with the tools that Shopify offers, any seller can quickly set up an online store to sell their products globally, or employ the company's hardware-software solution (such as POS system) to sell in a brick-and-mortar store, or do both concurrently (omnichannel). In other words, Shopify aims to be the preferred partner for merchants, benefiting only when they are successful.

Shopify's fee structure further amplifies its focus on merchant success. With a monthly subscription fee of $29 for its basic plan, a new merchant can open an online store with plenty of softer tools at their disposal to make their first sale. Beyond that, Shopify takes a transaction fee ranging from 0.2% to 2% for each successful sale, aligning its interest with the seller's success.

This win-win arrangement helps explain Shopify's sustainable growth over the years. When merchants become successful using Shopify, new sellers get motivated to start their entrepreneurial journey using Shopify's platform. Besides, successful merchants contribute more revenue to Shopify and are also likely to become loyal customers.

And that brings up another key point to highlight about Shopify, namely its recurring revenue nature. For the year ending Dec. 31, 2024, the tech company had $178 million in monthly recurring revenue, or $2.1 billion annually, from its monthly subscription fees.

This revenue is extremely sticky and likely to continue growing over time. The rest of Shopify's revenue is correlated with its gross merchandise value (GMV), which is also recurring, provided that it continues to help merchants sell more products over time. For perspective, GMV grew by 26% in 2024, demonstrating the company's continued growth momentum.

Shopify's solid business model makes the company extremely attractive to investors, especially considering the vast growth opportunities ahead, both locally (in online and offline retail) and internationally. If the company can remain focused on delighting its users, it is likely to attract and retain more successful sellers over time.

Bear case:

While there is plenty to like about Shopify, investors must also consider the downside risk of owning the stock.

One thing to note is that as Shopify continues to grow in size, it may struggle to sustain its historically high growth rates, even though it is likely to continue growing at respectable rates.

For instance, Shopify experienced explosive growth during the pandemic as online sales penetration skyrocketed. However, that tailwind has faded, creating some challenges for the company during the later-pandemic period. The silver lining is that Shopify has expanded beyond its online roots to offer omnichannel solutions for merchants, allowing it to continue growing its total retail market share through its brick-and-mortar solutions.

Besides, as Shopify scales, it will inevitably gain more attention from giants like Amazon, which will try to fend off the younger player from taking market share. With enormous resources (financial, human talent, and technology), Amazon could pose a threat to Shopify's ongoing expansion.

For example, Amazon could offer a more comprehensive set of tools (including logistics, cloud computing, and AI solutions, as well as advertising) to attract key Shopify merchants to its marketplace.

Beyond competition risk, Shopify is increasingly facing macro risks, especially now that it has sellers globally. The recent tariff war has become increasingly burdensome for small and medium-sized sellers to conduct business, which could lead to either lower sales volumes or even the outright closure of their businesses.

If merchants suffer, Shopify will feel the pain since its revenue is closely tied to merchants' success.

It doesn't help that Shopify's stock trades at a significant premium, posing substantial rerating risks if the company fails to meet investors' expectations. As of the time of writing, Shopify's stock trades at a price-to-earnings (P/E) ratio of 110, a high figure by any standard.

What it means for investors

Shopify has a solid track record of execution and growth, leveraging its business model and customer-obsessed culture. These advantages strategically position it to sustain its growth momentum.

Still, investors should not expect a smooth ride, as the tech company must fend off competitors while navigating turbulent macroeconomic situations, such as tariffs. And with the stock trading at premium levels, buying the stock today is not for the faint-hearted.

Only those with a long time horizon (more than five years) and a strong conviction should consider buying 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 $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 173% 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

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Lawrence Nga has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon and Shopify. The Motley Fool has a disclosure policy.

Shopify (NASDAQ: SHOP) stock soared 13% in May, according to data provided by S&P Global Market Intelligence. It reported well-received earnings results, and it benefited from an ease in tariff raises -- for now.

Best-in-class e-commerce services

Shopify is an e-commerce services provider, offering everything from full website development to single components for omnichannel retailers, including physical hardware. It's gone from its niche of small businesses to become a full commerce giant supporting large, well-known brands with many of its solutions.

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 »

Like any company that's become top of its industry, it's experienced ups and downs. It has recovered from an ill-fated expansion into delivery services that hurt its bottom line, and it's now in a phase of strong growth and rising profits. With lots of opportunity, it should stay in that place for many years.

In the 2025 first quarter, revenue increased 27% year over year to $2.4 billion. Gross merchandise volume increased 23% to nearly $75 billion, very close to Amazon's e-commerce sales. Operating income more than doubled to $203 million, and free-cash-flow margin was 15%, up from 12% last year. These are strong results that demonstrate Shopify's dominance in e-commerce, a growing industry.

The market was also happy about the temporary pause on high tariffs on Chinese goods. As a global e-commerce provider, Shopify has millions of merchants across the world who rely on its platform, and it could be negatively impacted by raised tariffs and a global trade war. Management explained that it has released a tariff tracker that makes it simple for merchants to source goods from different countries based on tariff information, powered by artificial intelligence (AI). That can help them avoid raising prices while continuing to generate sales, and the market gave that update a thumbs-up.

Opportunity abounds

These are just short-term factors, but the real reason to buy Shopify stock is its long-term potential. Shopify is the top e-commerce platform in the U.S., with about 30% of the market, giving it a robust edge against competitors. As e-commerce increases as a percentage of retail sales, it provides organic tailwinds for Shopify's business.

At the same time, it has huge opportunities in capturing greater market share internationally. International sales only account for 30% of Shopify's business, giving it a long growth runway as it expands and offers more services outside of the U.S.

The market was rewarding Shopify's recent wins, but investors should buy it for the long-term opportunity.

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 $651,049!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $828,224!*

Now, it’s worth noting Stock Advisor’s total average return is 979% — 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

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 no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon and Shopify. The Motley Fool has a disclosure policy.

Sunny days and summertime festivities are on the horizon for June. But there's no guarantee the clouds overhanging the broader market will dissipate.

Instead of trying to guess what the stock market will do in the short term, a better approach is to invest in companies with strong underlying investment theses that have the staying power to endure economic cycles.

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 »

Here's why these Fool.com contributors see Apple (NASDAQ: AAPL), Shopify (NASDAQ: SHOP), Cava Group (NYSE: CAVA), ExxonMobil (NYSE: XOM), and Energy Transfer (NYSE: ET) as five top stocks to buy in June.

Apple's pricing power will be put to the test

Daniel Foelber (Apple): There are 30 components in the Dow Jones Industrial Average (DJINDICES: ^DJI), and the worst-performing year to date is health insurance giant UnitedHealth (NYSE: UNH) -- which crashed due to cost pressures, regulatory scrutiny, suspended guidance, and another major leadership change. However, it's the second-worst performing Dow stock that is piquing my interest in June -- Apple.

Apple is down 22% year to date at the time of this writing -- making it the worst-performing "Magnificent Seven" stock. I think the sell-off is an excellent opportunity for long-term investors.

The simplest reason to buy Apple is if you think it can pass along a decent amount of tariff-related cost pressures. The latest update at the time of this writing is a 25% tariff on smartphones made outside the U.S. And since Apple assembles the vast majority of iPhones in China, the tariff could directly impact its bottom line.

Given higher labor costs and manufacturing challenges, moving production to the U.S. isn't a viable option. So, the million-dollar questions are how long tariffs will last and if Apple can pass along some of its higher costs to consumers.

A major catalyst that could drive iPhone demand even if prices go up is the upgrade cycle. Apple releases new iPhones every September. Most consumers aren't upgrading every year, but rather, waiting until they need to upgrade or the features appeal to them.

The upcoming iPhone 17 could have far more artificial intelligence (AI) features than the iPhone 16 -- which could attract buyers even with a higher price tag. Investors will learn more about Apple's technological advancements at its Worldwide Developers Conference from June 9 to 13.

Also, in Apple's favor, its pricing has stayed consistent for years. The base price of a new iPhone hasn't changed since 2017 as the company has preferred to keep prices low to get consumers involved in its ecosystem to support growth in its services segment. Apple's product growth has been weak in recent years, but the services segment has flourished, led by Apple TV+, Apple Music, Apple Pay, iCloud, and more.

Given tariff woes, it's easy to be sour on Apple stock right now. But the glass-half-full outlook on the company is that if tariffs do persist, at least they are coming during a time when Apple is expected to make by far its most innovative iPhone ever.

All told, long-term investors looking for an industry-leading company to buy in June should consider scooping up shares of Apple.

A growing e-commerce platform giant

Demitri Kalogeropoulos (Shopify): Shopify stock returns are roughly flat so far in 2025, but there are brighter days ahead for owners of this e-commerce services giant. The company just wrapped up a stellar Q1 period, as sales growth landed at 27%. Sure, that was a modest slowdown from the prior period's 31% increase, but it still marked the eighth consecutive quarter of growth of at least 25%.

Merchants are finding plenty of value in Shopify's expanding suite of services, even through the latest disruptive tariff-fueled trade disruptions. Merchant solutions revenue jumped 29%, helping lift sales growth above the company's 23% increase in gross sales volumes. "We built Shopify for times like these," company president Harvey Finklestien said in a press release. "We handle the complexity so merchants can focus on their customers."

Shopify is having no trouble converting those market share gains into rising profits, either. Operating income more than doubled to $203 million, and the company achieved a 15% free cash flow margin, up from 12% a year ago.

Concerns over more trade disruptions have likely kept a lid on the stock price following that positive Q1 earnings report in early May. But the company still expects 2025 growth to be in the mid-20s percentage range year over year. Shopify affirmed its initial aggressive outlook for free cash flow, too, although management sees a slightly slower profit increase (in the low-teens percentage rate) ahead for the year.

Investors can look past that minor profit downgrade and focus on Shopify's broader growth story that involves more merchants signing up for more services and booking more transactions on its platform. Success here should make the stock a great one to add to your portfolio in June, with the aim of holding it for the long term.

A Mediterranean feast for growth investors

Anders Bylund (Cava Group): Shares of Cava Group are down more than 40% in the last six months. That doesn't exactly make it a cheap stock, since Cava trades at 69 times earnings and 9.2 times sales even now.

But the Mediterranean fast-casual restaurant chain is growing quickly while reporting profits, and also widening its profit margins over time. That's a lucrative combo that deserves a premium stock price.

Cava's success hasn't gone unnoticed, despite the plunging stock chart. Two-thirds of analysts who follow this stock have issued a "buy" or "overweight" rating, and Wall Street's average target price is 44% above Thursday's closing price.

The company has a habit of absolutely crushing each quarter's analyst estimates across the board, including a huge surprise in May's first-quarter report. The average analyst expected earnings of just $0.02 per share on revenues in the neighborhood of $281 million. Instead, Cava reported earnings of $0.22 per share and $332 million in top-line sales.

A report like that would normally boost Cava's stock, but the market reaction was negative. Management noted that same-store sales growth could slow down in the second half of 2025, since the unpredictable economy is weighing down consumer spending. Cava's healthy salad bowls and pita wraps are on the pricey side, making the chain a vendor of everyday luxuries. This strategy could make Cava vulnerable to shifts in consumer confidence, especially when paired with the stock's lofty valuation.

So you won't find the stock in Wall Street's bargain basement today, but it did move down from the high-end valuation penthouse it inhabited a few months ago. If you like your investments fresh and flavorful, Cava's combination of healthy growth and expanding profits could be a recipe for long-term portfolio success.

42 dividend raises, with more coming up

Neha Chamaria (ExxonMobil): With renewables on the rise, people often believe the oil and gas industry isn't where to bet on anymore. While the global demand for energy overall is only expected to grow, driven by developing countries, ExxonMobil is in a sweet spot. It is working hard to bring down its break-even oil price significantly to stay relevant in the long run. At the same time, it is developing new low-carbon products and solutions.

It believes these new businesses could have potential addressable markets worth $400 billion by 2030 and over $2.3 trillion by 2050. Biofuels, carbon capture and storage, and low-carbon hydrogen are just some of the new products ExxonMobil is focused on.

Overall, ExxonMobil wants to produce "more profitable barrels and more profitable products" and is also cutting costs aggressively. The oil and gas giant believes a better product mix and its cost-reduction efforts combined could add nearly $20 billion in incremental earnings and $30 billion in operating cash flows by 2030.

In short, ExxonMobil is already charting a growth path to 2030 without compromising on capital discipline. It wants to generate big cash flows and maintain a strong balance sheet even through oil market down cycles, and ensure it can continue to reward shareholders with a sustainable and growing dividend on top of opportunistic share buybacks.

ExxonMobil has already proven its mettle when it comes to shareholder returns. It has increased its dividend each year for the past 42 consecutive years. Even without dividends, the stock has more than doubled shareholder returns in the past five years. With ExxonMobil stock now trading almost 20% off its all-time highs, it is one of the top S&P 500 (SNPINDEX: ^GSPC) stocks to buy now and hold.

Ready to rebound

Keith Speights (Energy Transfer): I'm not worried in the least that Energy Transfer LP's unit price is down year to date. This pullback presents a great opportunity to buy the midstream energy stock in June.

Energy Transfer's business continues to rock along. The limited partnership (LP) set a new record for interstate natural gas transportation volume in the first quarter of 2025. Its crude oil transportation volume jumped 10% year over year in Q1. Natural gas liquid (NGL) transportation volumes rose 4%, with NGL exports increasing 5%.

The LP's growth prospects remain solid. Energy Transfer commissioned the first of eight natural gas-powered electric generation facilities in Texas earlier this year. It plans to partner with MidOcean Energy to build a new LNG facility in Lake Charles, Louisiana. Artificial intelligence (AI) is a new growth driver, with Energy Transfer agreeing to provide natural gas to Cloudburst Data Centers' AI data centers.

The Trump administration's tariffs shouldn't affect Energy Transfer much. All of the company's 130,000-plus miles of pipeline are in the U.S. Energy Transfer has already secured most of the steel to be used in phase 1 of its Hugh Brinson pipeline project. Co-CEO Marshall "Mackie" McCrea said in the Q1 earnings call that management doesn't "expect to see any major challenges, if any challenges at all, selling out our terminal every month, the rest of this year."

Even if Energy Transfer's unit price doesn't move much, investors will still make money thanks to the LP's generous distributions. The midstream leader's forward distribution yield currently tops 7.3%. Energy Transfer plans to increase its distribution by 3% to 5% each year.

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 $651,049!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $828,224!*

Now, it’s worth noting Stock Advisor’s total average return is 979% — 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

Anders Bylund has positions in UnitedHealth Group. Daniel Foelber has no position in any of the stocks mentioned. Demitri Kalogeropoulos has positions in Apple and Shopify. Keith Speights has positions in Apple, Energy Transfer, and ExxonMobil. Neha Chamaria has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple and Shopify. The Motley Fool recommends Cava Group and UnitedHealth Group. The Motley Fool has a disclosure policy.

Market volatility over the past few months could lead investors to sell and take their winnings home before things get worse. But investing success means riding out the short-term waves and holding on to long-term winners. The S&P 500 (SNPINDEX: ^GSPC) has already made up whatever it lost in value earlier this year, and it would have been a shame to have sold at a low and missed out on the quick rebound.

If you can hold on for at least 20 years, you can choose excellent stocks and let them work their magic on your investments. Amazon (NASDAQ: AMZN), Shopify (NASDAQ: SHOP), MercadoLibre (NASDAQ: MELI), and SoFi Technologies (NASDAQ: SOFI) are four monster stocks that should reward you well over the next 20 years.

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 »

1. Amazon: E-commerce and AI

Amazon is the leader in e-commerce and cloud computing, two massive growth industries. It has about 40% of the U.S. market share in e-commerce and about 30% of the global market for cloud computing. Both of these industries are growing organically, and Amazon is benefiting from these organic tailwinds.

Shoppers know Amazon as the king of e-commerce, and the company is heavily investing in keeping its lead there. But management has identified generative artificial intelligence (AI), primarily through the Amazon Web Services (AWS) cloud-computing business, as its main growth driver over the next few years.

Amazon said it would invest upwards of $100 billion in 2025 alone to keep building out this business, and it offers a huge assortment of features and tools to every size and stripe of client. AWS itself generated a 17% year-over-year increase in sales in the first quarter and has a $117 billion annualized revenue run rate. Management expects that with generative AI, that rate will increase.

"We thought AWS had the chance to ultimately be a multihundred-billion-dollar revenue run rate business," CEO Andy Jassy recently said of the pre-generative AI opportunity. "We now think it could be even larger."

Advertising and streaming continue to grow and add value to the business, and Amazon is investing in new concepts like Zoox autonomous vehicles and Project Kuiper broadband. It has a huge growth runway, and its stock should keep rewarding investors over many years.

2. Shopify: The other e-commerce giant

You won't see Shopify on any list of highest e-commerce sales because it doesn't sell products, it sells e-commerce services, like websites and payment processing. But its gross merchandise volume (GMV) is similar to Amazon's e-commerce sales, giving you a picture of Shopify's important and dominant position in the e-commerce space.

Shopify is also benefiting from the organic tailwinds of e-commerce growing as a percentage of retail sales. According to eMarketer, e-commerce accounted for 20.3% of retail sales in 2024, and that's expected to increase to 23% by 2027. Even that's still a small percentage, and with each percentage point translating into trillions of dollars, Shopify has a long growth runway.

It also continues to identify new ways to expand its market share and help its clients increase their sales. It has gone from a platform helping small businesses get online to targeting large businesses with individual e-commerce components. It offers a full-service omnichannel platform combining physical and digital retail, and it's making a bigger move into international, where there are several bigger players. International sales only accounted for 30% of the total in Q1, and that could be a huge growth driver in the coming years.

Patient investors should expect Shopify to be a top stock as it keeps growing and innovating for the foreseeable future.

3. MercadoLibre: The Latin American tech disruptor

MercadoLibre is similar to Amazon in that its core business is e-commerce, but it has dipped its toes into several other businesses that are driving fantastic growth. It operates in Latin America and offers a host of digital services in both e-commerce and financial technology. It consistently reports strong growth across metrics, such as a 40% increase in GMV year over year and a 72% increase in total payment volume in the 2025 first quarter.

The opportunity here is enormous because Latin America lags many other global regions in both e-commerce and digital penetration. In fact, 85% of sales are still offline, and some of its regions are underbanked, leading to a greater necessity for digital financial services.

Because its regions are still in their early innings in its industries, there are so many levers MercadoLibre can pull to move growth. It's doing so step by step, bringing in new, unique visitors to its ecosystem and generating higher purchase frequency. It's launching all sorts of innovative services, such as a new, free streaming initiative powered by its growing ad business.

MercadoLibre has a wide-open runway and tons of opportunities to grow its business and stock gains.

4. SoFi: The modern way to bank

SoFi is a digital financial disruptor offering all banking services online. It targets the young professional who's just starting their financial journey and appreciates SoFi's tech focus and easy-to-use interface.

Although its core business is lending, it has successfully expanded into a large array of financial services like bank accounts and investing tools. These are fee-based products that have low costs and are becoming incredibly profitable.

Even the lending business is bouncing back as interest rates go lower, and lending revenue increased 25% year over year in Q1. Financial services, though, more than doubled, and contribution profit increased 299%.

It's adding members at a high rate and generating higher engagement through cross-selling and upselling, and SoFi has a massive growth opportunity over the next 20 years as it gets closer to its ambition of becoming a top-10 U.S. bank.

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

Before you buy stock in Amazon, 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 Amazon 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 $653,389!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $830,492!*

Now, it’s worth noting Stock Advisor’s total average return is 982% — 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 May 19, 2025

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 MercadoLibre and SoFi Technologies. The Motley Fool has positions in and recommends Amazon, MercadoLibre, and Shopify. The Motley Fool has a disclosure policy.

In this podcast, Motley Fool analyst Jason Moser and host Dylan Lewis discuss:

• The U.S. and China's short-term trade truce, and why there's some hope that a more permanent deal will be struck.
• Fox's next step into streaming with Fox One, its existing Tubi footprint, and success in video advertising.

GoDaddy is known for its commercials, less known for its capital allocation strategy. GoDaddy CFO Mark McCaffrey walks Motley Fool host Ricky Mulvey through the company's philosophy on share buybacks.

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 »

To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. When you're ready to invest, check out this top 10 list of stocks to buy.

A full transcript is below.

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

Before you buy stock in GoDaddy, 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 GoDaddy 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.

See the 10 stocks »

*Stock Advisor returns as of May 12, 2025

This podcast was recorded on May 11, 2025

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Dylan Lewis: Set the time machine for a few weeks back. Motley Fool Money starts now. I'm Dylan Lewis and I'm joined over the airwaves by Motley Fool analyst Jason Moser. Jason, thanks for joining me.

Jason Moser: Happy to be here, Dylan. Thanks for having me.

Dylan Lewis: On this bright and sunny day for the market. S&P 500 up a little over 2%, Nasdaq up, the Dow Jones up, everybody up on reports of the US-China trade deal. I've seen this called tariff cuts, Jason. I've also seen it called temporary trade truce. The market's excited about it. What are you calling it?

Jason Moser: I definitely understand the excitement. Yes, bright and sunny day in the market. It's bright and sunny day here in Northern Virginia, and hey, happy belated Mother's Day to all of the mothers out there. What a tremendous Sunday. We had a great time here, and I hope everyone else did too.

We woke up to a great headline, of course, the market responding obviously very positively to it. I think that goes back to what we have been talking about for the last couple of months, is just day by day, you just don't know really what is going to happen. This is a very headline-driven market, and for as bad as things may seem one day, you just don't know the next day they could turn on a dime, and it seems like today we hit that turn on dime status. I think it's worth remembering, this is a temporary solution. This is not something that is locked in in a full-on deal, but it does seem at least like there is some progress in diplomacy and talks. Perhaps the UK deal that was announced late last week, is a bit of a catalyst here. Maybe that's a sign of good things to come. We will have to wait and see.

But I think a lot of what we've been discussing in regard to tariffs and trade talks, most of this is really centered around ultimately China. China is the pot of gold at the end of the rainbow, as they would say. This is where we really need to figure this deal out because when you talk about trade deficits, and there are positives and negatives that come with all of that. But in regard to China, specifically, we've become very dependent on China through the years. When you think about the relationship we've had with China through the years, going all the way back to the 1970s when we really started diplomatically working together, over time, we've seen this trade deficit, where we're importing more than we're exporting. This trade deficit has just continued to grow.

You look at the 2000s. Around 2000, that trade deficit had reached around $85 billion. From there, it just continued to grow. It hit a peak of close to $420 billion in 2018. Today, it's closer to around $300 billion. But the goal, I think, here, is to try to balance that relationship out. Hopefully, this is a sign of good things to come. Again, it's one headline. We don't know a lot. There are not a lot of specifics, but it does seem like progress is at least being made.

Dylan Lewis: If you're like me, you've probably had a hard time following where we are relative to where we've started with a lot of these escalations. From the reading and from some of the reporting out there, it seems like this essentially resets to where we were with the US and China relations in late March. Initial tariffs announced by the Trump administration, retaliations on both sides. You were on the show last week with our colleague Ricky Mulvey, talking about how the S&P 500 had essentially retraced the Liberation Day losses. In terms of macro mentality, are we basically looking at 90-day amnesia here, where we lost some time, but we wound up back in the same place?

Jason Moser: When we look at the numbers, it's just been such a boring year. The market is essentially flat. Ho-hum, who cares? This has just been a really bumpy ride, going back to, you remember how this all started? This was what? The late February, early March, where the conversation really centered around Canada and China in certain trade negotiations there, but also fentanyl stuff and border stuff. Then it expanded very quickly to it seemed like virtually every country on the face of the planet, which is, I know, something like 180, 190 countries. It does feel like we are back to where we started. It's nice to see at least some progress being made. Go back to that UK trade deal. Hopefully, that is a sign of things to come.

We know that countries are coming to the table and want to negotiate. But again, given our relationship with China, and to an extent, our reliance on China, I think China is really seen as the most important of all of these deals. Again, time will tell there. Again, this is not a permanent solution. This is just something that it's extending the timeline. It's indicating that, hey, conversations are being had, because if you think about it, this tit for tat just doesn't work. Hey, I say 175% tariffs. Well, hey, I'll say 185%. Well, I'm going to go 195. It can just go up and up and up and nobody ends up benefiting. We certainly know that China's economy is suffering from this. But we also know that our economy will suffer from this as well. Particularly as we get closer to the holiday season, if you start seeing supply dwindle and consumers aren't able to get what they want, there are going to be real problems. There will be political ramifications that come from that, as well. It's good to see progress being made. I certainly would not look at this as a solution, but it seems like at least a step in the right direction.

Dylan Lewis: Your dogs seem to agree there, Jason.

Jason Moser: They do. They're big fans of diplomacy, Dylan.

Dylan Lewis: As we noted, good day for the market. Even better day for companies that are in the business of buying and selling, and really, anybody in retail, anybody with international supply chains. As you noted, this is a reset, but a reprieve as well. Not a full solution. Any wise words for investors seeing some major moves with their stocks today?

Jason Moser: I think it's great. We always love to see our portfolios in the green or the black, however you want to put it. But it's always nice to see positive as opposed to negative. I think it's really interesting to see the companies that are reacting most strongly to these results. Look at some of these companies that stand out, Wayfair, for example, have better than 20%, totally understandable. They really depend on the supply chain centered around China. Shopify, again, we've talked about that before, plenty of small and medium-sized businesses that do not fare well during these heavy tariff times, all the way down the line there. Amazon doing well, Nike doing well. I think it's nice to see those companies at least starting to recover a little bit from these lows. Again, I think this reiterates why we invest the way we do here. It is so if you tried to time your way in and out of this stuff, I can't imagine that many people would have been very successful. Continuing to invest regularly, staying invested, that is something we just need to reiterate to people because that is really, truly, that's the solution to long-term wealth creation.

Dylan Lewis: We may get some more commentary on the big picture here when we see Walmart and some of the Chinese companies like Alibaba report later in the week, fairly big earnings week, and Fox got started. They're out with earnings this week, and they also had an announcement that their upcoming streaming service, Fox One, will be launching before the upcoming football season, which I can't imagine is an accident. I imagine that's quite intentional. This is something we've been looking forward to for a while, Jason. There's a history of legacy media companies getting streaming services right. There's a history of legacy media companies getting streaming services wrong. I think CNN+ lasted for about a month. What are you thinking about as you see Fox stepping up to the competition here?

Jason Moser: I think it's noteworthy to acknowledge that Fox is looking at this streaming service as something where they want to attract the cord cutter. There's two sides of the coin here, in that we've got folks who are still very happy cable subscribers, and we were looking at it countrywide. There's still plenty of cable subscribers out there. Now, we know the trend is toward cord-cutting, but Fox wants to make sure to offer something for everyone. If, for example, you are a cable subscriber and you get your Fox channels, well, then it sounds like you're going to get access to this Fox One streaming service as well. If you're a cord cutter and you don't really want to participate in the cable network, well, then you have the opportunity to go ahead and subscribe to this Fox streaming service. It's important to note, I think this Fox streaming service is going to be all of the properties. It's not just Fox News. It's the stand-alone Fox channel. It's all of the Fox Sports channel. It's everything that comes within that Fox portfolio.

Let's be clear. It's a very popular portfolio. It garners a lot of viewers, and I think that really matters. You referred back to that NFL relationship there, and that is obviously a very big driver come August when we start talking about preseason and getting into September with the regular season games. NFL is just big business. We know that, and Fox benefits greatly from that. I think we don't really know exactly what pricing is going to look like for this service yet, but it does sound like at least they are not looking for some type of discount or low cost price point, something like, think about Disney when they introduced Disney Plus, for example, and I think they started that out at 599 or 699 per month. I don't think that's what this is going to be. It's going to be something that's a little bit more reflective of the value that they feel like they're returning to all of their viewers. But all things considered, I think this makes sense. It's going to be something that I think helps expand their viewership and gives everybody a chance to participate in that Fox portfolio, how they want, whether they're cable subscribers or whether they are cord cutters that really just want to find access to the best content.

Dylan Lewis: One thing that might bolster some market confidence here in what Fox is able to do, this is not their first horse in the streaming race. They already own Tubi, which is a free ad-supported streaming service. A sleeper in the streaming space in a lot of ways, but at a critical mass. I think with what they saw for Super Bowl editions, they are probably over 100 million monthly active users at this point. It's not a profitable operation for them yet, but they've done over a billion dollars in trailing 12-month revenue. There is some track record of success here, and I think crucially, Jason, there's success in connecting with advertisers and working that ad-supported model. That really seems to be the future of where a lot of this industry is going.

Jason Moser: Well, we've talked about this a lot in regard to ad-supported video-on-demand. This is a massive market opportunity worldwide. I think when you get outside of the US and you get to economies that are a little bit more cost-sensitive, it makes even more sense. But when you look at revenue in the advertising video-on-demand supported market right there, worldwide, it's projected to reach around $55 billion in 2025. That's only going to continue to grow. For me, it makes a lot of sense that they continue to pursue this. It's just interesting that, I don't know about you, it's not top of mind for me. I'm not the biggest Tubi user. I know we have the app on our TV, and I guess we use it every once in a while if we're searching for content. But again, you mentioned this massive base of user, closing in on 100 million monthly active users. They saw in the quarter, their total revenue is up 27%. Fox's total revenue is up 27% for the quarter. Advertising revenue increased 65%, and that primarily was due to the impact of Tubi. They saw tremendous benefit there from the Super Bowl. I think that's something that is slated to continue. For me, it makes sense that they continue to invest in this business because not only do they benefit from this portfolio of central Fox offerings that they have, but then they've got these other little ancillary properties that they just continue to invest in and they fly under the radar.

But obviously, it's working out very well for the company. I think it's worth noting, you look at Amazon, for example, Amazon making a lot of investments in their Freevee offering, which is something essentially, you're going to get Amazon Freevee if you just have Amazon at all, if you're a Prime member. However your relationship is with Amazon, you're going to have access to Freevee. Amazon clearly sees an opportunity there as well. Again, I think, going back to those growth numbers in the AVOD market there, it's nice to see that Fox continues to invest in this business because it's obviously working out for them.

Dylan Lewis: Fox is not a name that we talk about all that often and to our detriment. Shares up almost 60% over the last 12 months. I was glad that we had the opportunity to check in on it because it's one that not a lot of folks have been paying attention to. Stock basically set new all time highs earlier this year, not too far off those levels now. It seems like advertising is a big part of the recent run. If this is getting onto people's radar at all, anything else you pay attention to?

Jason Moser: I think just continue to pay attention to the overall advertising revenue. The ratings that Fox brings in, I think we all know. Fox does pretty well with all of its properties. I think they really benefited tremendously from this most recent election cycle. They noted in the call from last call that on election night, they saw over 13-and-half million viewers tuning in, and then I think they said Fox News Channel had grown. It become the most watched cable network in total day and prime time in that space, growing total day audience by nearly 40%, and then their prime time audience by 45% year over year. It's not just Fox News. We go back to the NFL relationship in all of the different ways they can really win. It's not just Fox News. It's Fox Sports. It's Fox News. It's the stand-alone Fox offering there. They do have a lot of different ways they can win with their media properties. At the end of the day, it does boil down to ratings and as it stands right now, Fox continues to bring in strong ratings across all of its properties. That would be a very encouraging thing for investors looking to maybe get some exposure to the entertainment space.

Dylan Lewis: Jason Moser, thanks for joining me today.

Jason Moser: Thank you.

Dylan Lewis: Hey, Fools, we're taking a quick break for a word from our sponsor for today's episode.

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Listeners, coming up on the show, you may know GoDaddy for its commercials, but you probably don't know its capital allocation story. One that's made the stock a market beater. My colleague Ricky Mulvey caught up with GoDaddy's CFO, Mark McCaffrey, for an interview about the company's growth engine and philosophy on share buybacks.

Ricky Mulvey: A lot of our listeners may know GoDaddy as a domain registration business. They may not know GoDaddy as a long-term market outperformer, which I want to get into. We'll focus on the quarterly results, though, because right now, the growth engine and about a third of your revenue is coming from this applications in commerce business. This is not just registering websites. That's where you're getting 17% sales growth. For our listeners who just know GoDaddy is a spot where you're buying websites, what should they understand about the applications in commerce business?

Mark McCaffrey: Absolutely. It's a great question. We've become so much more than just being a domain company over the years. We just hit our 10-year anniversary of being a public company. We've been around 28 years. We've become a one-stop shop for micro businesses that provide them the IT services for them to be effective, them to be efficient, them to compete on a much broader scale. We're talking the mom and pop shops. I always refer to them the underdogs. They are doing what they love. They are passionate about what they do. They want to do it broader. They want to connect to more customers. They may not be IT savvy. We provide them, I sometimes refer to it as the operating systems for the micro businesses. That's what our application and commerce segment represents. Our core platform was the traditional domain part of our business, but this is the software that gets attached.

It's more often than not a website or an email or commerce capabilities. But it represents a second and third and fourth product attached that makes our customers successful. Because it's proprietary software and some third-party software, but proprietary software, it comes at a much higher profit margin for us and therefore has been our growth engine. It has become a bigger and bigger part of the business.

Ricky Mulvey: We've been talking on the show about how very large companies are using artificial intelligence, Microsoft building up with OpenAI. Palantir getting inserted into every government and any company they can find. You're at a micro level with very small businesses in helping them use AI to build and grow their businesses. At a very broad level, how do you see AI impacting small business creation in the US right now?

Mark McCaffrey: When you think about it, and again, when we say micro businesses, we're probably smaller than the small businesses others refer to. They don't think about AI as to, oh, my God, I want to use AI, but they want to have help. They don't want to hire necessarily more employees. But yet, for example, they have to respond across multiple different social media platforms to inbounds, and our tools do that automatically. They write in their voice. They allow them to be in multiple places at multiple times. I was just meeting with, I call them the pizza guys, but they're two guys who run a mobile pizza oven, and between putting a pizza in for 90 seconds, they're on our conversations tool just clicking Send to make sure that they're setting up their next gig. That's the type of customer we want. They don't sit there and think about, oh, my God, I'm using AI. They're sitting there going, oh, my God, this just works better. That is the customer we want. That's what our product does, Airo, A-I-R-O, just for the record. It allows our customers using AI to respond more effectively and more efficiently within their customer base to grow. It works because we have so much data around it.

Ricky Mulvey: This is a zone where Shopify also plays. We talk about Shopify a lot on the show. What's the differentiation of Airo? If I'm a micro business, if I'm starting my own pizza business with my brother, why would I do it on GoDaddy's platform instead of Shopify?

Mark McCaffrey: Number 1, it's a seamless experience for us. You come to one place and you're able to get all the functionality. Number 2, the cost effectiveness of it. We do it at such a good price point for the value our customers are getting. It allows them to start up, be more successful, and quite frankly, manage across one application. When you think about it, we're the only company in the world that has the technology stack all the way from the domain to the transaction. Because we can combine that into one seamless experience with them, they don't have to manage eight apps. They manage one app, and when they need help, they go to our care organization, and our care organization is designed to work with this customer base, work with the micro business. This is what they do best and why they're so effective. Between the technology itself and our ability to guide them through all of this, I always say, you can be up and running with a business in 15 minutes. I get corrected by my internal people to say, no, actually, we can do it in three minutes. Can you stop saying it takes so long. But you can get everything you need almost instantaneously bundled together as a great price, be up and running with website, transactions, professional email, and a domain, and you can be getting all your traffic across multiple social media platforms. That's what we offer. It's simple. It's easy. It's easy to use, and it's easy to maintain.

Ricky Mulvey: One of the reasons I'm happy to have you on the show is that GoDaddy has a very interesting capital allocation story. There's a long-term outperformance for your stock since GoDaddy IPOed. But 2023 is when a lot of that performance came, and that's in line with when you started a stock repurchase authorization program. Since 2022, GoDaddy bought back four billion dollars worth of stock. I don't want to dismiss the growth in the actual business, but there's a capital allocation story here that's important for shareholders. As CFO, you've really focused on share buybacks. You've got another three billion dollar authorization plan moving forward for the next few years. But just conceptually you've got a lot of options at your disposal. You can buy back stock. You can pay a regular dividend. You can pay a special dividend. Why stick with the buyback so much?

Mark McCaffrey: I'll start with the underlying premise that we think investing in our own stock is one of the most attractive returns we have out there. We've shown that we've been able to execute on this buyback strategy very effectively. Thank you for pointing out. We've done it over four years, four billion dollars. Not many companies have reduced their fully diluted share account by 25% over a period of time such as this. We're very proud of that, and we're very proud to not only share the success we've had, obviously, we generate a lot of free cash flow that allows us to have these options, but also return that value back to our shareholders and do it in a manner that we continue to, I would say, create this great model. I'll even take it a step further, how many companies out there today are growing 6-8%, have expanded their normalized EBITDA margins by 900 basis points in five years, and then bought back 25% of their fully diluted shares over a similar period of time and still are able to compound to free cash flow per share on a CAGR of 20%. That whole model works together for us fantastically. It's durable. It's resilient, and we continue to put it forward because it works, and our investors keep giving us the feedback. They really like the program. They really like how we do this, and they want us to continue doing this.

Ricky Mulvey: Since GoDaddy's IPO 10 years ago, I mentioned this at the top, it's been a quiet market beater, and a lot of that performance has come within the past few years, so I don't want to dismiss that. But when you look at the overall results, the S&P 500 compound annual growth rate of about 12%, the Nasdaq about 16%, and GoDaddy at 25%, smashing the return of the S&P 500. When you look back on 10 years as a public company, any reflections on the outperformance or maybe what's been the recipe for that at GoDaddy?

Mark McCaffrey: The recipe is focusing on what we call our North Star and making sure that everything we do is in honor of that North Star. We call our North Star free cash flow per share. We generate free cash flow, whether it's growth, whether it's profitability. We're always looking to do that in a way to maximize that equation, understanding that our model is durable, it's predictable, and we can use the levers to make sure we continue to compound into that equation and drive that value. As we've done that, as we've grown as a company, as we've hit this milestone, because we are a very large tech company, we know that hey, 90% of our revenue starts with our existing customer base. We know we have great products and innovation that bring people into our funnel. We know this model compounds on itself year after year as our customer retention rates get stronger. That compounding free cash flow is what creates the value within the business itself, and that's the same value we can use to return to our shareholders.

I would say the model works. Our execution of our strategy works. Our model works behind it, and it's about the compounding effect of layering on every year just to be a little bit better and to grow based on these metrics that just continue to generate cash flow. I would also say, three years ago, we took an effort to really simplify our infrastructure so that our operating leverage just supported this going forward. We're growing revenue at over two times. We're growing our operating expenses right now. That allows us to be so efficient in how we do things. When we're efficient, we can do what we do best, which is focus on our customers. Again, it all holds together, but it all compounds on each other. The balance sheet gets stronger. We're able to generate free cash flow. We're able to look at the options for capital allocation, and it puts us in a great spot going forward.

Ricky Mulvey: Good place, send it. Mark McCaffrey. That is the chief financial officer of GoDaddy. Appreciate your time and your insight. Thanks for joining us on Motley Fool Money.

Mark McCaffrey: Thanks, Ricky. Thanks for having me.

Dylan Lewis: As always, people in the program may have interests in the stocks they talk about, and Motley Fool may have formal recommendations for or against, so don't buy sell anything based solely on what you hear. All personal finance content follows Motley Fool editorial standards. It's not approved by advertisers. Advertisements are sponsored content provided for informational purposes only. To see our full advertising disclosure. Please check out our show notes. For the Motley Fool Money team, I'm Dylan Lewis. We'll be back tomorrow.

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Dylan Lewis has positions in Shopify. Jason Moser has positions in Amazon, Shopify, and Wayfair. Ricky Mulvey has positions in Shopify. The Motley Fool has positions in and recommends Amazon, Microsoft, Palantir Technologies, Shopify, and Walmart. The Motley Fool recommends Alibaba Group, GoDaddy, and Wayfair 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.

Here's our initial take on Shopify's (NASDAQ: SHOP) fiscal 2025 first-quarter financial report.

Key Metrics

Metric	Q1 2024	Q1 2025	Change	vs. Expectations
Revenue	$1.86 billion	$2.36 billion	27%	Beat
Earnings per share	-$0.21	-$0.53	n/a	Met
Gross merchandise volume	$60.9 billion	$74.8 billion	23%	Met
Free cash flow	$232 million	$363 million	56%	n/a

Shopify Posts Growth, but Questions Remain

Shopify posted solid growth in the quarter, with revenue up 27% year over year and gross merchandise volume sold on its platform up 23% to nearly $75 billion. The company also reported a higher net loss, but much of that was accounting related. Backing out the impact of equity investments, net income was up 57% to $226 million in the quarter, and free cash flow climbed by a similar percentage to $363 million.

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 »

The company posted a 15% free cash flow margin in the quarter, the seventh consecutive quarter of double-digit free cash flow.

Heading into the quarter, investors were focused on how tariffs and trade wars would impact Shopify's core business. Although the company itself is not a big importer, many of its customers rely on China for merchandise sold on the Shopify platform. The elimination of the "de minimis" loophole, which allowed shipments from China valued at less than $800 to enter duty-free, was particularly worrisome.

Shopify's outlook provided no reason for further panic but also did little to quell the fears. The company expects revenue growth in the current quarter in the mid-20 percentage-wise, matching but not topping Wall Street's forecast for 23% growth.

In a statement, company president Harley Finkelstein made the case that "businesses perform better on Shopify, regardless of market conditions." Shopify's set of tools can help merchants better navigate changes in tariffs and other trade policies, potentially helping the business to gain new customers in the quarters to come.

Immediate Market Reaction

Given the looming threat of tariffs, the market is taking a glass-half-empty approach to this report and the guidance for what is to come. Shopify shares were down about 8% in premarket trading following the release but ahead of the market open.

What to Watch

With the market seemingly moving more on broader macro fears than on Shopify's actual results, management is likely to spend a lot of time on the call talking investors through their outlook for the quarters to come and how Shopify will attempt to navigate through the uncertainty.

The quarter seemingly did little to settle the debate over whether Shopify is a net loser or net winner from the trade wars. But the strong growth and forecast for further growth in the second quarter, coupled with the cash generation, does provide ample evidence that Shopify is a survivor even if conditions worsen in the quarters to come.

Helpful Resources

• Full earnings report
• Investor relations page

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 $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!*

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*Stock Advisor returns as of May 5, 2025

Lou Whiteman has positions in Shopify. The Motley Fool has positions in and recommends Shopify. The Motley Fool has a disclosure policy.

In 2025, Wall Street has been rattled with increasing concerns about U.S.-China trade wars, escalating geopolitical pressures, rising economic uncertainties, and growing recession fears. The benchmark S&P 500 index is down nearly 4.7% in 2025.

However, this market volatility and sell-off have opened up attractive entry opportunities for retail investors. Companies such as Broadcom (NASDAQ: AVGO), Shopify (NASDAQ: SHOP), Vertex Pharmaceuticals (NASDAQ: VRTX), and Intuitive Surgical (NASDAQ: ISRG) can be smart bets now. Here's why.

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Broadcom

Broadcom's stock has seen a dramatic decline of almost 22% from its recent high in December 2024, driven by escalating market fears due to trade wars between the U.S. and China. Yet, the stock remains an alluring buy due to its robust artificial intelligence (AI) strategy and strong financial position.

Unlike many other chip players, which focus on developing general-purpose accelerators that can cater to multiple applications, Broadcom focuses on custom XPUs tailored to the specific needs of its hyperscaler clients. This customization makes the chips optimal for particular workloads, delivering higher performance and energy efficiency for hyperscaler clients.

This strategy seems to be paying off, since management estimates an addressable market of $60 billion to $90 billion from its existing three hyperscaler clients by 2027. This projection does not include the four additional hyperscaler clients already designing custom XPUs. Furthermore, Broadcom's networking solutions are also in high demand, as they are a critical component of large AI clusters.

Broadcom also boasts robust financials, as evidenced by the 25% year-over-year revenue jump and 44% year-over-year operating income surge in the recent quarter (first-quarter fiscal 2025 ended Feb. 2).

Broadcom is trading at 29.4 times forward earnings, far lower than its five-year average of 70.5. Hence, considering its upside potential and reasonable valuation, this may be an opportune time to pick a small stake in this stock.

Shopify

E-commerce giant Shopify is currently down nearly 25% from its recent high in February 2025. Despite this, with the company posting solid 31% year-over-year top-line growth and operating margin of 17% in the recent quarter and reaching an annual gross merchandise value (GMV) of $300 billion, this share price pullback seems like an excellent entry opportunity for retail investors who are ready to ignore short-term share price volatility.

While Shopify does not sell anything online, it provides a complete tech-powered omnichannel setup for merchants to reach out digitally to customers. Once known mainly for focusing on small and medium enterprises, the company now caters to several larger global brands.

Shopify also sees significant growth potential in international markets and has invested strategically in localization, compliance improvements, and local payment methods. Offline commerce and B2B commerce have also emerged as potent growth opportunities. Shopify is also committed to using advanced AI technologies to help new merchants launch and larger merchants scale with greater productivity on its platform.

The stock is trading at a forward price-to-earnings ratio of 66.2, greater than its five-year average of 39. However, the rich valuation seems justified considering its diversified business model, multiple growth drivers, and resilience. Analysts also expect revenue to grow 25.3% year over year to $2.33 billion. That's a healthy growth projection, even though elevated tariff wars may affect it indirectly through its merchant clients. Therefore, the stock seems like an attractive choice now.

Vertex Pharmaceuticals

Shares of Vertex Pharmaceuticals have risen by nearly 23.9% in 2025. However, this healthcare giant still has significant potential for growth.

Vertex continues to dominate the cystic fibrosis (CF) market with drugs such as Trikafta/Kaftrio and the more effective and conveniently dosed next-generation Alyftrek. In 2024, Trikafta/Kaftrio accounted for nearly $10.2 billion of the company's $11 billion net product revenue. With Trikafta's patent protection extending till 2037, the company has robust revenue visibility.

Vertex has also made its presence felt in blood disorders, pain management, diabetes, and renal diseases. Journavx, the first new non-opioid pain medicine to be approved by the U.S. Food and Drug Administration (FDA) in over 20 years, has a potential market of 80 million patients with all types of moderate to severe acute pain. The recently launched Casgevy is also proving to be a transformative one-time treatment for patients with certain blood disorders.

The company has demonstrated robust financial strength, with $11.2 billion in cash and hardly any debt. Considering the company's many strong tailwinds and solid financials, a forward price-to-earnings multiple of 24.2 does not seem expensive, making the stock a worthwhile buy now.

Intuitive Surgical

Leading surgical robotics player Intuitive Surgical's shares have been mostly flat in 2025. However, with its global da Vinci installed base exceeding 10,000 systems across 70 countries, the company's stock seems well-positioned for rapid growth in the coming years, despite facing challenges in importing and exporting medical device components due to the ongoing trade wars.

Intuitive Surgical has demonstrated robust operational and financial performance, with 18.5% year-over-year procedure growth on a day-adjusted basis and a 19% revenue jump in the first quarter of 2025. The company's latest da Vinci 5 system is gaining strong momentum, with nearly 147 systems placed and more than 32,000 procedures performed in the first quarter.

Intuitive Surgical also expects to enable additional features for its da Vinci system, such as real-time surgical video review, force feedback technology, and real-time 3D model review.

The company is also continues to develop its Case Insight computational technology, which has delivered data sets such as video, kinematic energy, and force data for over 22,000 procedures performed with the da Vinci system. This helps surgeons effectively review procedure videos to identify operational and clinical insights. Intuitive expects these computational tools to be a major differentiator in the long run.

Against this backdrop, although a forward price-to-earnings multiple of 56.6x appears expensive, the rich valuation reflects the company's market-dominance and significant growth prospects -- making it a smart buy even at elevated levels.

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

Before you buy stock in Broadcom, 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 Broadcom 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 $623,685!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $701,781!*

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See the 10 stocks »

*Stock Advisor returns as of April 28, 2025

Manali Pradhan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Intuitive Surgical, Shopify, and Vertex Pharmaceuticals. The Motley Fool recommends Broadcom. The Motley Fool has a disclosure policy.

Equity markets may be struggling because of President Donald Trump's current economic policies, but that doesn't mean investors should avoid buying stocks right now -- quite the contrary. History tells us that equities tend to experience strong runs following downturns, so it's worth putting money into excellent companies that are being dragged down with along with the broader market.

To that end, let's consider five excellent growth-oriented companies to invest in on the dip: Novo Nordisk (NYSE: NVO), Eli Lilly (NYSE: LLY), Vertex Pharmaceuticals (NASDAQ: VRTX), Intuitive Surgical (NASDAQ: ISRG), and Shopify (NASDAQ: SHOP).

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Novo Nordisk and Eli Lilly

It might seem odd to group Eli Lilly and Novo Nordisk, but these drugmakers have much in common. They've been the leaders in the diabetes drug market for decades, and both are now pioneering the obesity management space. Novo Nordisk was first to market with Wegovy, an anti-obesity medicine that has become a household name. Eli Lilly then made its move with Zepbound, whose sales are growing incredibly rapidly.

Both companies also have exciting candidates in the pipeline in diabetes and obesity care. Eli Lilly should release data from phase 3 clinical trials for orforglipron, a once-daily oral pill for weight management, sometime this year. Novo Nordisk failed to impress the market with late-stage clinical trial data for CagriSema, an anti-obesity candidate, but it has more potential gems in its pipeline.

Novo Nordisk and Eli Lilly have both seen sales grow rapidly in recent years thanks to their dominance in weight management. And although some observers were worried about their valuations, the current sell-off should take care of that problem.

There are some key differences between these two leading drugmakers. Novo Nordisk is more focused on diabetes than its counterpart; as of November, it held a 33.7% share of the diabetes care market -- remaining flat year over year. Eli Lilly has blockbusters in other areas, such as immunology and oncology.

In the long run, expect somewhat more of the same, though Novo Nordisk should succeed in diversifying its operations. The crucial point is that both companies are innovative drugmakers with deep lineups, pipelines, and significant growth prospects. Now that they've become cheaper in the sell-off, it's a great time to buy.

Vertex Pharmaceuticals

Vertex Pharmaceuticals is another leading drugmaker that famously dominates its market: medicines for cystic fibrosis (CF), a disease that affects internal organs. Vertex develops the only therapies in the world that target the underlying causes of this condition.

The company generates steady revenue and profits. Though it's made tremendous headway in treating CF patients since the early 2010s, there remain many who have yet to start treatment, even among those who are eligible for its current drugs.

Elsewhere, the biotech has expanded its lineup thanks to therapies like Casgevy, which treats a pair of blood-related disorders, and Journavx, a non-opioid pain medication; both should be significant growth drivers. And that's before we look into the pipeline, which boasts several promising candidates.

Vertex Pharmaceuticals' prospects remain attractive, making it a top stock to buy in this downturn.

Intuitive Surgical

Intuitive Surgical is a medical device specialist that dominates the robotic-assisted surgery (RAS) market. The company's crown jewel is the da Vinci system, which is approved for many procedures across multiple areas. The most recent iteration of this device -- the fifth -- is an improvement over previous versions. Though it only received clearance last year, it has already attracted quite a bit of attention, more than analysts expected.

This shows, once again, Intuitive's commitment to innovation. So, despite the threat of competition from healthcare giants like Medtronic and Johnson & Johnson -- both of which are working on RAS devices -- Intuitive Surgical's long-term prospects look attractive. Besides its innovative abilities, Intuitive benefits from a first-mover advantage: It will take years before newcomers jump through all the clinical and regulatory hoops needed to challenge the company's dominance.

Meanwhile, the RAS market remains underpenetrated, with fewer than 5% of eligible procedures being performed robotically. Expect Intuitive to grow its installed base and procedure volume at a good clip in the long run, along with its revenue and earnings. The stock can still provide outsized returns.

Shopify

E-commerce specialist Shopify started the year on a strong note. Its financial results have been strong lately, particularly on the bottom line, where relatively recent changes (getting rid of its logistics business and increasing its prices) are helping boost profits. However, the company has not escaped the market downturn. Still, considering Shopify's position in the e-commerce field -- and the industry's prospects -- this is an excellent opportunity to pick up some shares.

Shopify gives merchants everything they need to start and run an online storefront, with thousands of apps in its app store that cater to merchants' demands beyond the company's basic offerings. It also holds a 12% market share in the U.S. by gross merchandise volume -- that's up from 10% in 2022. And it benefits from a strong competitive advantage based on switching costs.

Meanwhile, e-commerce still accounts for under 20% of total retail commerce in the U.S., one of the world's leaders in the industry. Shopify could ride the increased growth of this market for years and deliver strong returns to loyal, patient shareholders. That's why the stock is worth buying on the dip.

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

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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:

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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

Prosper Junior Bakiny has positions in Eli Lilly, Intuitive Surgical, Johnson & Johnson, Novo Nordisk, Shopify, and Vertex Pharmaceuticals. The Motley Fool has positions in and recommends Intuitive Surgical, Shopify, and Vertex Pharmaceuticals. The Motley Fool recommends Johnson & Johnson, Medtronic, and Novo Nordisk and recommends the following options: long January 2026 $75 calls on Medtronic and short January 2026 $85 calls on Medtronic. The Motley Fool has a disclosure policy.