Investors are off to a good start into 2025, as the major stock market indexes have been in line so far. while writing, S&P 500,,,, Nasdaq syntheticand Dow Jones jones industrial average Increases of 2.9%, 2.3% and 3.6% respectively.
However, over the past 12 months, a number of individual stocks have recorded returns that far exceeded those of the benchmark index. Today, three Motley Fool contributors are highlighting some of their top picks: reddit (NYSE:RDDT),,,, ocean limited (NYSE:IT)and Yuan platform (Nasdaq: Yuan).
Jake Lerch ((reddit): For me, Reddit is a stock at the top of my watch list.
Reddit stock has gained more than 270% since its initial public offering (IPO) in March 2024. Over the same period, the S&P 500's 17% return was about 16x.
Reddit operates one of the most visited websites, specializing in topic-based message boards. This gives a hit to advertisers, who can tailor their ad buys based on topics and interests relevant to their products and services.
The company continues to grow its user base. In its most recent quarter (ending September 30, 2024), it reported 97 million active users (DAUS), up 47% from a year ago.
Engagements also increased. Conversion page views, an ad performance metric, increased 40% year over year. Revenue for the quarter rose 68% to $348 million.
This impressive growth is expected to continue. According to data analysts compiled by Yahoo!, the company will generate sales of $1.75 million in 2025, a year-over-year increase of 37%.
As for risk, the stock's price ratio of nearly 24 puts it out of reach for value investors, but in the fast-growing technology world, its valuation remains reasonable, if still on the expensive side.
All in all, Reddit is well positioned for excellent revenue growth thanks to steady user growth and an ad-based business model. Investors looking for solid technology stocks with room to grow should consider it.
Will be heavy (Ocean Limited): In focusing on places like the United States and China, investors often overlook Southeast Asia's nearly 640 million people. The region includes Singapore and top markets in developing countries such as Thailand and Vietnam. in the case of sea co., ltd. (NYSE:IT)taking advantage of these markets helped boost stock prices by 226% in the last year.
For those who don't know Sea Limited, it is a group of three businesses.
It operates a fintech business in Southeast Asia called Sea Money, which has been performing well. The company's e-commerce arm, Shopee, is the leading online retailer in the region. Finally, Sea Limited started out as an online gaming company. The section called Garena claims free fireIt is one of the world's leading mobile games and is its most famous product.
Thanks to these businesses, the stock grew significantly in 2020 and 2021 as pandemic activity increased across all three segments. But it retreated in 2022 as the pandemic reversed course. Shopee fails attempt to expand outside Southeast Asia, bans free fire Among the largest gaming markets, India contributed significantly to the decline.
Amid sharp decline, Shopee decides to follow Amazon and other peers by investing in logistics in their home regions. Additionally, according to news reports, a series of reboots free fire Being in India is "imminent", which should improve Garena's recovery.
The success has strengthened SEA's financial position, with its revenue of nearly $12 billion rising 26% in the first nine months of 2024, driven by growth across its three businesses compared to the same period in 2023.
Through the first three quarters of 2024, net income fell to $207 million, compared with $260 million in the same period last year. However, the company also increased its spending on e-commerce and other services by $1.5 billion during the period, an investment that should help solidify its competitive advantage in its core markets.
Finally, in terms of valuation, the relatively new profitability gives it a high price-to-earnings (P/E) ratio. However, its forward yield is 31, a valuation that could help attract more investors in 2025 given the company's continued growth potential.
Justin Pope (Meta Platforms): It feels like you're missing the boat on the meta platform. The stock is up more than 60% in the past 12 months, and even more in the past two years. However, there is still room for newcomers to jump on.
Over the past few years, the company has put investors on edge by pouring billions into artificial intelligence (AI) and virtual reality through its Reality Labs, which has only resulted in billions of dollars in losses.
However, there are some emerging signs that the AI push may soon start to pay off. According to a recent Bloomberg report, the company is developing multiple products to take users away from their smartphones, including at least three new types of smart glasses, wrist devices, and earbuds. Its Mission brand has seen success with augmented reality headsets, appleThe Vision Pro so far looks like a failure.
Meta was one of the first major AI companies to open up its AI model (Llama), making it freely available to developers. This could expand Camel's use in enterprise and government applications as it competes with closed AI ecosystems like OpenAI. It's too early to know what impact these factors may have on the business, but fortunately, Yuan is already worth buying.
The social media giant continues to grow its user base, and continued uncertainty over Tiktok's future could lead to greater engagement on the company's Facebook, Instagram, WhatsApp and Threads platforms. Management has unleashed generated AI for advertisers, helping them create more effective ad campaigns, which has only strengthened Meta's advertising prowess and pricing power.
Today, the stock has a price-to-earnings ratio of 29. That's a reasonable valuation for a company that analysts expect to grow at an annual rate of 18% over the long term. Investors can buy Meta stock today with confidence because of its strong core business and what's likely to happen in the future.
Before you buy stocks on the Meta platform, consider the following:
this Motley Fool Stock Advisor A team of analysts just identified what they believe is 10 Best Stocks For investors, there are options to buy now...and Meta Platform is not one of them. 10 stocks that are cutting back on jobs that could generate monster returns in the years to come.
consider when Nvidia This list was made on April 15, 2005...if you had invested $1,000 at the time of the recommendation, You will have $874,051! *
Now, it's worth noting stock advisorThe overall average return is 937% - compared to market fight 178% for the S&P 500 Index. Don't miss the latest top ten list.
learn more"
*Stock Advisor returns as of January 21, 2025
Randi Zuckerberg is a former director of market development, Facebook spokesperson, sister of Meta Platforms CEO Mark Zuckerberg, and a member of Motley Fool's board of directors. John Mackey, the former CEO of Amazon subsidiary Whole Foods Market, is a Motley Fool board member. Jake Lerch holds positions at Amazon and Reddit. Justin Pope has no position in any of the stocks mentioned. Will Healy holds a position with Sea Limited. The Motley Fool owns and recommends Amazon, Apple, Meta Platforms, and Sea Limited. Motley Fools has a disclosure policy.
Up 22% to 273%, There's Still Time to Buy These 3 Stocks originally published by Motley Fool