Growth stocks have the potential to deliver above-average earnings growth compared to their respective industries. These stocks tend to perform well in the low-interest rate environment. Hence, with improving economic conditions and potential interest rate cuts in 2025, growth stocks are well poised for a strong performance next year. However, growth stocks come with higher risk and volatility compared to other stocks.
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Today, we have identified five stocks that have received Strong Buy ratings from analysts, with price targets suggesting over 10% upside potential in the next 12 months. These stocks also carry Outperform Smart Scores (i.e., 8, 9, or 10) on TipRanks, indicating that these stocks may continue to beat the market. Lastly, these companies’ revenues have witnessed a compound annual growth rate of over 10% in the past three years.
Let’s take a look at five such stocks that investors can consider.
- MercadoLibre (MELI) – MercadoLibre is a leading e-commerce platform. The stock has an average price target of $2,359.09, which implies a 36.72% upside potential. MELI’s revenues have witnessed a 54% three-year CAGR. The stock has a Smart Score of eight.
- Eli Lilly (LLY) – This global pharmaceutical company develops innovative medicines for diabetes, cancer, and neurodegenerative diseases. Its average price target of $1,039.73 implies a 32.8% upside potential from the current levels. The company’s revenue has grown at a CAGR of about 11.6%. LLY stock carries a Smart Score of eight.
- Carnival Corporation (CCL) – Carnival is a leisure travel company that operates a fleet of cruise ships under several brands. The stock’s average price target implies an upside potential of 14%. Its revenues increased at a CAGR of 56.9% in the past three years. Also, CCL has a Smart Score of “Perfect 10.”
- Meta Platforms (META) – Meta is a technology company specializing in social media, virtual reality, and digital communication through platforms like Facebook, Instagram, and WhatsApp. Analysts currently see an upside potential of 12.1% in the stock. Also, it has a Smart Score of “Perfect 10,” and its topline has grown at a CAGR of 16.2%.
- Taiwan Semiconductor (TSM) – Taiwan Semiconductor is one of the world’s leading manufacturers of semiconductor chips. TSM stock’s average price target implies a consensus upside of 15.3%. Its revenues increased at a CAGR of 17.3% and has a Smart Score of “Perfect 10.”
