5 Amazing Growth Stocks to Buy Before 2026

Five growth names are highlighted as portfolio additions based on strong third-quarter 2025 operating results and long runways: MercadoLibre reported revenue up 49% year‑over‑year (currency neutral) and GMV +35% as e‑commerce and fintech usage expands across 18 Latin American markets; Dutch Bros posted sales +25% and comps +5.7% with EPS rising from $0.11 to $0.14 as management targets aggressive store growth; On delivered revenue +35% and a 60.6% gross margin with net income up 290% year‑over‑year; Nu reported revenue and net income +39% with ARPU rising from $11 to $12 amid rapid Latin American digital banking penetration; Amazon’s dominant e‑commerce position (~40% US share) and AWS exposure to generative AI are cited as catalysts for renewed growth. These metrics support a constructive view on diversified growth exposure outside pure AI plays, emphasizing company fundamentals and earnings momentum.

Analysis

Market structure: Winners are asset-light growth exposures with network effects — MELI (e‑commerce + fintech) and NU (digital banking) gain from LatAm adoption and AI-driven payments; AMZN benefits via AWS AI demand. Consumers/peers with low differentiation (legacy retailers, single-channel cafes) face margin pressure as scale operators (AMZN, MELI) flatten pricing power and accelerate loyalty programs. Cross-asset: stronger risk‑on for equities should steepen curves (higher real yields), pressure high‑beta put prices, and amplify BRL/MXN/COP FX moves (±5–15% swing risk around elections); coffee commodity volatility (±10% 6‑month) directly hits BROS margins.

Risk assessment: Tail risks include LatAm regulatory clampdowns on fintech (probability ~10% over 12 months), BRL devaluation >20% in adverse macro, or a hard US tech regulatory push that trims AWS contracting. Immediate (days): earnings/holiday cadence; short (weeks/months): FX and election windows; long (quarters/years): credit cycle impact on MercadoLibre/Nu loan books. Hidden dependencies: ARPU and credit-loss sensitivity to local rates (a 200bp rate move can change net income by mid‑teens % for fintech segments).

Trade implications: Favor 12–24 month directional exposure to MELI/NU/AMZN, size by conviction (2–4% each) and use defined‑risk option spreads to cap drawdowns. Relative/value: long ONON vs short LULU to capture premium growth re‑rating, and long BROS with commodity hedges (coffee futures or swaps) if expansion guidance holds. Rotate 2–4% from AI‑concentrated mega caps into LatAm fintech and select specialty consumer names to lower portfolio concentration.

Contrarian angles: Consensus overweights AI platform winners and underestimates FX/regulatory drag on EM fintech; valuations may underprice 1) credit deterioration and 2) capex needs for retail rollouts (BROS). Historical parallel: prior EM fintech waves saw rapid user growth then regulatory tightening (2015–2018); if BRL weakens or US charter for NU stalls, rerate risk is underappreciated. Expect bumpiness — not linear upside.

Key Decisions for Investors

• Establish a 2.5% long position in MELI via a 12–18 month call‑spread (buy LEAP, sell higher strike) to capture fintech + e‑commerce growth; size to P&L so a 30% adverse move caps loss to ≤50% of position premium. Monitor Q4 GMV and quarterly active‑user growth; trim 25% if YoY GMV growth slips below 20% for two consecutive quarters.
• Allocate 3% long to NU common stock (or 12–18 month LEAP calls) to play LatAm digital banking; hedge FX exposure >50% of position notional by selling a 3‑month BRL forward or buying BRL call options if available. If Brazilian bank charter progress stalls beyond 90 days, reduce to 1% (sell half).
• Add 3–4% long AMZN equity, funded by reducing AI‑ETF exposure by 2–3%; sell 3–6 month 10–15% OTM covered calls to generate yield while keeping upside. Buy a 6–9 month call spread (ATM to +25%) to express incremental AI revenue acceleration with defined risk.
• Implement a pair trade: long ONON 1.5% vs short LULU 1.5% (equal $) to exploit premium growth/scale divergence; set stop‑losses at 18% adverse movement and take profits at 35% gain. Validate on next two quarters: exit short if LULU gross margin expands >200bp or ONON revenue growth drops below 20% YoY.
• Reduce portfolio AI/concentration risk by 2–4% and park proceeds in 3‑month T‑bills until two catalysts clear (US CPI prints and LatAm election outcomes within 60–90 days); redeploy if markets confirm sustained risk‑on (equity breadth >60% and 10y yields stable or down 20bp).