3 Growth Stocks That Could Skyrocket in 2025 and Beyond

Growth Stocks Overview - Growth stocks have performed exceptionally well this year, with major U.S. indexes reaching new all-time highs [1] - Earnings growth is expected to continue, providing further upside potential for stocks [1] - Key characteristics for selecting growth stocks include a robust business model, dominant market share, consistent revenue and earnings growth, free cash flow generation, and a growing total addressable market [1] Autodesk (ADSK) - Autodesk develops design software for architects, engineers, and designers, and offers a platform for data mining and process automation [3] - Revenue grew from $4.4 billion in fiscal 2022 to $5.5 billion in fiscal 2024, with net income nearly doubling from $497 million to $906 million [3] - In the first half of fiscal 2025, revenue increased 11.8% YoY to $2.9 billion, operating income rose 34% to $642 million, and free cash flow reached $651 million [3] - Total billings increased by 13% to $1.2 billion, indicating strong top-line growth [3] - Growth strategies include renewing and expanding the core design business, monetizing non-paying users, adjusting prices for inflation, and expanding into adjacent sectors like water and construction [4][5] - The company aims for annual revenue growth of 10% to 15% [5] The Trade Desk (TTD) - The Trade Desk operates a cloud-based platform for digital advertising, offering the largest connected TV inventory in the industry [6] - Revenue grew from $1.2 billion in 2021 to $1.9 billion in 2023, with net income increasing from $137.8 million to $179 million [6] - Free cash flow rose from $318.5 million in 2021 to $543.3 million in 2023 [6] - In the first half of 2024, revenue increased 27% YoY to $1.1 billion, operating income surged sixfold to $123.4 million, and net income more than doubled to $116.7 million [7] - Free cash flow for the half year stood at $233 million, and customer retention rates exceeded 95% [7] - Growth opportunities include the connected TV space, international markets, and the retail sector, with a total addressable market estimated at $900 billion [7][8] Blackline (BL) - Blackline provides a cloud platform for financial closing and accounting, leveraging AI to streamline operations [9] - Revenue grew from $425.7 million in 2021 to $590 million in 2023, with net income turning positive at $52.8 million in 2023 [9] - Free cash flow improved from $56.8 million in 2021 to $99 million in 2023 [9] - In the first half of 2024, revenue increased 12.1% YoY to $318 million, operating income surged 51.7% to $4 million, and net income excluding exceptional items rose 19% to $22.4 million [10] - Free cash flow more than doubled YoY to $78.1 million, and customer count grew at an annualized rate of 9% from 2020 to 2023 [10] - Growth strategies include a "land and expand" approach, targeting enterprise and mid-market segments, and leveraging a total addressable market worth $39 billion [11]