5 Momentum Stocks Investors Can Add to Boost Portfolio Returns in 2025

Market Overview - The U.S. stock market has shown resilience in 2024, supported by a healthy economic backdrop and Federal Reserve rate cuts, despite volatility and inflationary pressures [1] - Year-to-date performance: S&P 500 up 26.2%, Dow Jones Industrial Average up 13.8%, Nasdaq Composite up 30.1% [1] Momentum Investing - Momentum investing is highlighted as a strategy that can yield good returns, albeit with associated risks [2] - This strategy involves buying stocks that are expected to appreciate in the near term, focusing on stocks with a good Momentum score and favorable Zacks Rank [3][11] Top Picks for Momentum Stocks - Five momentum stocks have been identified based on their favorable Zacks Rank and Momentum Score: Carvana Co. (CVNA), Datadog, Inc. (DDOG), Fortinet, Inc. (FTNT), Amazon.com, Inc. (AMZN), and InterDigital, Inc. (IDCC) [12][13] Carvana Co. (CVNA) - Zacks Rank 1, Momentum Score B, market cap of $46.2 billion - Current-year earnings estimate improved by 111.9% to $1.25 per share, indicating a year-over-year increase of 66.7% - Stock has risen 73.1% in the past six months [5] Datadog, Inc. (DDOG) - Zacks Rank 2, Momentum Score B, market cap of $50.1 billion - Current-year earnings estimate improved by 7.3% to $1.76 per share, indicating a year-over-year increase of 33.3% - Stock has appreciated 23.8% in the past six months [6] Fortinet, Inc. (FTNT) - Zacks Rank 1, Momentum Score B, market cap of $73.9 billion - Current-year earnings estimate improved by 9.9% to $2.23 per share, indicating a year-over-year increase of 36.8% - Stock has appreciated 64.4% in the past six months [7] Amazon.com, Inc. (AMZN) - Zacks Rank 2, Momentum Score A, market cap of $2,367 billion - Current-year earnings estimate improved by 9.3% to $5.19 per share, indicating a year-over-year increase of 79% - Stock has appreciated 20.6% in the past six months [8] InterDigital, Inc. (IDCC) - Zacks Rank 1, Momentum Score B, market cap of $4.8 billion - Current-year earnings estimate improved by 46.9% to $15.22 per share, indicating a year-over-year increase of 64.9% - Stock has appreciated 64.3% in the past six months [9] Future Outlook - The U.S. markets are expected to grow in 2025, driven by steady consumer spending, technological innovation (especially in AI), and a healthy labor market [10] - However, inflation and geopolitical turmoil are noted as potential headwinds [10] Company Insights Carvana Co. - Focused on operational efficiency post-acquisition of ADESA's U.S. operations, with a three-step plan to achieve positive adjusted EBITDA and boost growth [14][19] Datadog, Inc. - Benefiting from new customer additions and increased demand for its cloud-based monitoring and analytics platform [15][20] Fortinet, Inc. - Gaining from strong demand from large enterprises and growth in security subscriptions, with increased IT spending on cybersecurity expected to drive revenues [16][21] Amazon.com, Inc. - Experiencing solid Prime momentum and strong adoption of AWS services, with a focus on generative AI [17][22] InterDigital, Inc. - Driven by strong licensing momentum and product innovation, with key partnerships with major companies [18][23]