As the end of 2024 approaches, several companies present promising investment opportunities. Taking advantage of these opportunities before large fund managers could position investors favorably for 2025. Among these potential investments are three standout stocks, each with significant upside potential in its respective market: CrowdStrike, Meta Platforms, and dLocal.
CrowdStrike
CrowdStrike (CRWD) was regarded as a leading cybersecurity stock before experiencing an incident on July 19 that affected millions of devices. However, the impact was minimal, and CEO George Kurtz confirmed that the company’s demand pipeline has returned to pre-incident levels, indicating the event caused only a brief disruption. CrowdStrike is focused on achieving an ambitious target: $10 billion in annual recurring revenue by fiscal year 2029, ending in January 2029. Reaching this target would be a remarkable achievement in just over four years.
If CrowdStrike can generate $10 billion in annual revenue and convert 30% into profits, similar to established software companies like Adobe, it could achieve $3 billion in annual profits. Using Adobe’s five-year average trailing price-to-earnings (P/E) ratio of 47 as a benchmark, CrowdStrike could realize a market cap of $141 billion. From its current market cap of $76 billion, this growth represents a compound annual growth rate (CAGR) of 16%, significantly outperforming the market. The cybersecurity market is vast, and CrowdStrike is well-positioned to excel within it, making it a potentially popular investment in the coming year.
Meta Platforms
Meta Platforms (META), historically known as Facebook, is recognized for its social media services and ventures in augmented and virtual reality. Additionally, the company is actively participating in the generative artificial intelligence (AI) sector with its large language model, Llama. In 2024, Meta Platforms experienced robust growth, exceeding 20% revenue growth in every quarter. Despite expectations that growth will slow to 14% in 2025, this still represents significant growth for a firm with a stronghold on social media advertising.
Meta Platforms is currently trading at a reasonable price, considering projected 2025 earnings. With a forward P/E ratio of 23, the company is an attractive investment, given its leadership in generative AI and solid social media advertising base. The expectation is for Meta Platforms to have another successful year in 2025, suggesting that purchasing the stock now in anticipation of future demand is a strategic decision.
dLocal
dLocal (DLO) may not be widely recognized, yet it provides crucial technology that enables its clients to operate in emerging markets such as Egypt, Indonesia, and Thailand by managing payment processing. These countries possess diverse payment infrastructure, and establishing individual solutions is expensive. dLocal offers a ready-to-use service for a fee, simplifying the process for clients. Its client roster includes significant names like Amazon, Spotify, and Microsoft, substantiating its business value. Despite this, the stock is not widely respected, trading at 19 times trailing earnings and 14 times projected 2025 earnings.
The lack of recognition stems from dLocal being relatively under-the-radar, but its financial performance has been impressive. In the second quarter, dLocal’s payment volume rose 38% year-over-year to $6 billion, although revenue increased by only 6%, primarily due to currency deflation in countries like Egypt, Nigeria, and Argentina. With CEO Pedro Arnt, formerly of Latin American giant MercadoLibre, leading the company, there is confidence he can steer it back to substantial growth. The market potential for dLocal’s services is vast, making it an attractive prospect heading into 2025.
John Mackey, former CEO of Whole Foods Market (an Amazon subsidiary), serves on 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 also a board member. Keithen Drury holds positions in several companies, including Adobe, Amazon, CrowdStrike, DLocal, MercadoLibre, and Meta Platforms. The Motley Fool has investments in and recommends several of these companies and also suggests specific options related to Microsoft. The organization maintains a disclosure policy.
