As we approach the end of 2024, there are plenty of companies worth buying right now. It would be wise to pick some of them up before the bigger fund managers do to position themselves for 2025.
I've got three solid stocks to pick up before 2025 rolls around. Each has immense upside if it dominates its respective markets.
CrowdStrike
CrowdStrike (NASDAQ: CRWD) was the best cybersecurity stock on the market prior to its July 19 incident, which crashed millions of devices. However, the fallout from that occurrence was relatively small, and CEO George Kurtz stated that its demand pipeline is back at pre-incident levels. This means the July 19 incident has barely been a blip on the radar, so investors can focus on CrowdStrike's big goal: $10 billion in annual recurring revenue.
CrowdStrike plans to meet this goal by fiscal year 2029 (ending January 2029). That means the company thinks it can reach these levels in just over four years, which would be an incredible result.
If CrowdStrike can generate $10 billion in annual revenue and convert 30% of that into profits (as some established software companies like Adobe have), that would give it $3 billion in annual profits. Using Adobe's five-year average trailing price-to-earnings (P/E) ratio of 47 as a baseline would give CrowdStrike a market cap of $141 billion. From CrowdStrike's market cap of $76 billion today, that would result in a compound annual growth rate (CAGR) for investors of 16%, easily outperforming the market.
The cybersecurity market is massive, and CrowdStrike is well-positioned to dominate it. I suspect CrowdStrike will remain a popular investment next year, so buying shares now makes sense.
Meta Platforms
Meta Platforms (NASDAQ: META) is likely better known by its old name, Facebook. Although its primary business is social media, it also has other endeavors in the augmented and virtual reality space. Additionally, it's also competing in the generative artificial intelligence (AI) arms race with its large language model, Llama.
Meta has posted strong growth in 2024, with every quarter coming in above 20% revenue growth so far. Wall Street expects Meta's growth to slow in 2025 to 14%, but it's still solid growth for a company with a tight grip on social media advertising.
Still, it trades for a reasonable price tag when 2025 earnings are considered.
META PE Ratio (Forward 1y) Chart
A P/E of 23 for a company at the forefront of the generative AI race that has a rock-solid advertising business in its social media platforms to fall back on is a no-brainer investment. I'd expect Meta Platforms to have another solid year in 2025, so buying the stock now in preparation for that anticipated demand is a great move.
dLocal
dLocal (NASDAQ: DLO) is a company few have heard of. Essentially, it has the technology that allows its customers to operate in emerging markets like Egypt, Indonesia, or Thailand by processing payments for them. These countries each have a unique payment infrastructure, and setting up a solution for each country would be costly. But, if a client can pay dLocal a fee to use services that are ready to go, it becomes a no-brainer.
dLocal's client list includes Amazon, Spotify, and Microsoft, just to name a few. These big names legitimize dLocal's business, yet the stock gets no respect.
The stock trades at just 19 times trailing earnings and 14 times 2025 earnings.
DLO PE Ratio (Forward 1y) Chart
This is largely because dLocal is an undiscovered business, but its financial results have been phenomenal. In Q2, dLocal's payment volume rose 38% year over year to $6 billion, although revenue was only up 6%. This payment volume and revenue discrepancy largely centers around currency deflation in Egypt, Nigeria, and Argentina.
However, with CEO Pedro Arnt, who came from Latin American giant MercadoLibre, at the helm, I'm confident he can get this business back to an impressive growth rate. The market opportunity for this business is too large to ignore, and I want a piece of it heading into 2025.
Should you invest $1,000 in CrowdStrike right now?
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Keithen Drury has positions in Adobe, Amazon, CrowdStrike, DLocal, MercadoLibre, and Meta Platforms. The Motley Fool has positions in and recommends Adobe, Amazon, CrowdStrike, MercadoLibre, Meta Platforms, Microsoft, and Spotify Technology. The Motley Fool recommends DLocal 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.
