In this article, we will take a detailed look at the best economic recovery stocks to buy.
Economic cycles, as defined by economists, alternate between periods of growth, peak, recession, and recovery, depending on the stage that a country’s economy is at. In particular, the term “economic recovery” describes the period that follows a recession and is characterized by improving employment, increased business activity and investment, rising consumer confidence, and accelerating GDP growth. Recoveries usually start after governments enact fiscal and monetary policies to stimulate investment and spending – the primary stimulative instrument in the US has been the FED funds rate. When an economic recovery kicks in, the sectors that tend to outperform are the cyclical ones – consumer discretionary, industrial, financial, and technology – driven by both a recovery in the previously depressed valuations as well as by broad acceleration in growth.
Another important consideration for investors is that the stock market and the economy do not move in sync; the former tends to be a forward-looking animal, meaning that stock prices tend to rise in anticipation of an economic recovery, while the actual economic conditions may still be depressed and reflect low GDP growth, high unemployment and sluggish private spending. Consequently, the key takeaway for readers is that investments in economic recovery stocks shall be made during peak uncertainty and pain, at or near a market bottom when everyone is fearful and reluctant to buy. As the legendary Warren Buffet has put it,
“Be fearful when others are greedy and be greedy when others are fearful.”
READ ALSO: 11 Best Counter Cyclical Stocks to Buy According to Analysts.
The US economy and stock market are the most developed in the world and often reflect textbook examples of economic cycles. The previous unofficial recession in the US occurred in 2022, when the GDP growth posted 2 quarters of negative growth amid a sharp increase in interest rates to combat rising inflation. The stock market moved in sync with the economy during that year. The following year, 2023, resembled a slow recovery fueled by the emergence of the AI megatrend as well as strong public spending on infrastructure and other large projects. Calendar 2024 and early 2025 resembled an economic peak, as growth moderated and private spending became weaker. In such moments, even the slightest economic headwind and/or uncertainty can trigger a recession and a broad market meltdown. That’s exactly what happened with the new Trump 2.0 administration, which brought plenty of uncertainty related to tariffs and sharp cuts in the public sector.
While most investors are currently concerned about declining stock prices (the main US stock market benchmark is down over 11% at the time of this write-up since its February peak), the smart money is already looking for signals of a potential recovery. Atlanta Fed projects that the US economy posted negative real GDP growth in Q1 2025, estimated at -2.4%; given the uncertainty and tariff threats persisting in April as well, chances are that Q2 2025 will be in negative territory as well, which would mark an official recession. The problem is that the stock market already prices in such a scenario, which makes it difficult to exploit or hedge against. The only plausible move at the moment is to look for economic recovery stocks in an attempt to time the market bottom. We believe there are solid reasons to believe that the stock market bottomed out in early April and that things will only improve going forward.
The most important signal in favor of a potential economic recovery ahead is that Trump’s tariffs proliferate as a short-term negotiation tool only, which seems to work well in relation to most trading partners. On April 9, Trump announced a 90-day pause in new tariffs for 75 countries until negotiations to discuss potential solutions are arranged. Here’s how Kevin Breuninger, a CNBC journalist, commented the following on the recent developments:
The White House is clarifying that Trump’s announcement of a 90-day tariff “pause” means that the “tariff level will be brought down to a universal 10% tariff” during that time, while “negotiations are ongoing.” That respite does not apply to China, which will see U.S. tariffs on its goods rise to 125%.
We see this announcement as a sign that chances are high that the US will reach a positive agreement with the 75 countries mentioned. While the situation with China is still intense, things could deescalate if other countries reach agreements with the US and set the stage for China as well. In this context, if the tariffs saga is successfully navigated, the main headwind for the economy will dissipate, potentially triggering a broad economic recovery that would push stock prices higher. With that being said, we may currently be at an opportune moment to pick the best economic recovery stocks, which we discuss below.
Our Methodology
We used a screener to identify stocks with at least a 20% revenue compounded annual growth rate (CAGR) in the last 5 years. Then, we selected the top 10 stocks with the largest estimated average analysts’ upside and included them in the article in ascending order. For each stock, we also include the number of hedge funds that own the stock as of Q4 2024. The stocks are ranked according to the upside potential.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10. TD SYNNEX Corporation (NYSE:SNX)
Estimated average analysts’ upside: 43.06%
Revenue CAGR last 5 years: 26.68%
Number of Hedge Fund Holders: 33
TD SYNNEX Corporation (NYSE:SNX) is a leading global distributor and solutions aggregator for the IT ecosystem, which offers a comprehensive portfolio of IT products and solutions, including hardware, software, and services. The company’s IT solutions are designed for value-added resellers, system integrators, and managed service providers to analyze their own data and better monetize their products (boost profitability through getting new clients, cross-selling opportunities, or cutting costs). SNX is well-positioned to capitalize on increased IT spending during periods of low interest rates and economic recovery, making it a potentially attractive investment in such times.
TD SYNNEX Corporation (NYSE:SNX) reported strong momentum across the business in the latest Q1 2025, with gross billings growing 7.5% YoY and 9.5% in constant currency. The Advanced Solutions segment grew by 7% YoY, reflecting continued demand for integrated IT solutions, while Endpoint Solutions grew by 8%, with growth across PCs and mobile. The company’s strategic technologies, including cloud, cybersecurity, data and analytics, and Hyve, achieved double-digit growth across all geographic segments.
However, Hyve’s performance was below expectations due to component shipment delays and demand shortfalls, which management said may persist for a few quarters. Despite these temporary challenges, TD SYNNEX Corporation (NYSE:SNX) maintained its fiscal 2025 commitment to mid-single-digit gross billings growth and generated $1.1 billion of free cash flow. The company’s end-to-end strategy, global reach, and specialist go-to-market approach continue to enable it to capture a wide range of IT spend, with expansion to 30,000 active partners and 500,000 end users transacting through their cloud marketplace. SNX has demonstrated strong execution and the ability to grow all its products, even during uncertain times. This makes it one of the best recovery stocks to own if economic fundamentals improve.
9. Ingersoll Rand Inc. (NYSE:IR)
Estimated average analysts’ upside: 44.15%
Revenue CAGR last 5 years: 25.60%
Number of Hedge Fund Holders: 39
Ingersoll Rand Inc. (NYSE:IR) is a provider of industrial solutions, offering a diverse range of products such as air and gas compressors, pumps, vacuum systems, and power tools for the industrial and life sciences markets. The company’s competitive advantage is based on a strong scale and global presence, which allows it to be a reliable supplier to companies relying on customized products and parts. IR is one of the best economic recovery stocks to consider, as it has a proven history of thriving during periods when industrial activity and capital expenditures are accelerating. The US-based company ranked tenth on our recent list of 12 High Growth Non-Tech Stocks That Are Profitable in 2025.
Ingersoll Rand Inc. (NYSE:IR) delivered a strong performance in 2024 with double-digit adjusted EPS growth and a robust free cash flow margin, despite a dynamic global market environment. The company achieved a record adjusted EBITDA margin of 27.9%, up 190 basis points from the prior year, while full-year adjusted EPS finished at $3.29 per share, representing an 11% YoY increase. Total company orders were up 4%, and revenue increased 5% for the full year, with a book-to-bill ratio of 0.98, which demonstrates a deep pipeline of orders for customers.
Looking ahead to 2025, Ingersoll Rand Inc. (NYSE:IR) expects total revenue growth between 3% and 5%, with organic growth of 1% to 3%. The M&A pipeline remains robust, with over 200 companies in the funnel. The company has demonstrated continued success in its acquisition strategy, having acquired approximately $625 million in annualized revenue from 18 acquisitions in 2024 at less than 14x the pre-synergy adjusted EBITDA multiple, which is considered cheap in the current reality. Notably, the company maintains a strong balance sheet with total liquidity of $4.1 billion, including $1.5 billion of cash on hand at quarter end, which positions it well to withstand any economic slowdown and even a prolonged recession.
8. Royal Caribbean Cruises Ltd. (NYSE:RCL)
Estimated average analysts’ upside: 53.18%
Revenue CAGR last 5 years: 88.47%
Number of Hedge Fund Holders: 58
Royal Caribbean Group (NYSE:RCL) is one of the largest global cruise companies, operating more than 67 cruising ships across five brands, including Royal Caribbean International, Celebrity Cruises, and Silversea Cruises, serving tourists across the entire world. The company’s strength consists of offering diverse and innovative cruise experiences and onboard amenities, which attract new travelers each year and continuously popularize the cruising holidays format. As consumer spending on leisure tends to increase during economic recoveries, RCL is poised to benefit from heightened demand for vacations, which makes it one of the best economic recovery stocks to buy in anticipation of a potential market rebound.
Royal Caribbean Group (NYSE:RCL) delivered exceptional results in the latest Q4 as well as full year 2024, with a record 8.6 million vacations, 11.6% net yield growth, and over $5 billion in operating cash flow generated. The company achieved its trifecta of financial goals 18 months ahead of schedule while expanding capital allocation and maintaining investment-grade metrics. For 2025, management expects 23% earnings growth compared to last year, despite significant headwinds from foreign exchange and fuel rates.
Royal Caribbean Group (NYSE:RCL) announced a significant strategic expansion with Celebrity River Cruises, placing an initial order for 10 ships to launch in 2027. This expansion into river cruising represents an attractive high-margin, high ROIC business opportunity in a growing market that has experienced double-digit growth over the last decade. The company continues to strengthen its private destination portfolio, with the Beach Club in Nassau opening in late 2025 and Perfect Day Mexico in development, while maintaining strong booking momentum with the best five booking weeks in company history.
7. Comfort Systems USA, Inc. (NYSE:FIX)
Estimated average analysts’ upside: 57.91%
Revenue CAGR last 5 years: 22.45%
Number of Hedge Fund Holders: 50
Comfort Systems USA, Inc. (NYSE:FIX) is a leading provider of mechanical, electrical, and plumbing (MEP) services, including heating, ventilation, air conditioning (HVAC), piping, and fire protection systems. The company generates the majority of its revenue through the Mechanical Services segment, which serves commercial, industrial, and institutional clients across the US and offers services such as installation, maintenance, repair, and replacement of MEP systems. The services offered by FIX require a significant cash outlay from customers, which means that demand tends to decline during economic slowdowns but subsequently experiences accelerations when the economy recovers.
Comfort Systems USA, Inc. (NYSE:FIX) reported exceptional Q4 and full year 2024 results, with quarterly EPS up 60% from the previous year and annual earnings up 62% YoY. The company achieved record revenue with same-store revenue growth of 22% in Q4, while backlog reached an all-time high of $6 billion. Operating cash flow was remarkably strong at $849 million for 2024, demonstrating robust execution and customer relationships. The company’s gross profit margin improved significantly to 23.2% in Q4 2024 compared to 20.6% in Q4 2023, while the full-year gross profit margin increased to 21% from 19% in 2023, which points toward increasing pricing power and competitive advantage.
Comfort Systems USA, Inc. (NYSE:FIX)’s revenue mix is heavily weighted toward the industrial sector, accounting for over 60% of volume in 2024, with technology, including data centers and chip fab, representing 33% of revenue, a substantial increase from 21% in the prior year. Project pipelines remain at unprecedented levels, with particularly strong demand in the technology sector. Still, the demand is somewhat constrained by high interest rates and construction activity slowing down in the second half of 2024. If FIX demonstrated such strong growth during a constrained market environment, its growth will likely further explode if conditions improve. For this reason, we include FIX in seventh place on our list of best economic recovery stocks to buy.
6. WESCO International, Inc. (NYSE:WCC)
Estimated average analysts’ upside: 60.09%
Revenue CAGR last 5 years: 22.96%
Number of Hedge Fund Holders: 62
WESCO International, Inc. (NYSE:WCC) provides business-to-business distribution, logistics services, and supply chain solutions to a diverse clientele in the industrial, construction, utility, and commercial sectors. The typical products offered by WCC include electrical equipment, automation and connected devices, security solutions, and utility and broadband products that are designed to facilitate the production/operational processes of clients. Demand for the company’s products tends to accelerate significantly during economic recoveries, when industrial capex is stimulated by low financing costs and the need to boost production capacity.
WESCO International, Inc. (NYSE:WCC) returned to sales growth in Q4 2024, driven by exceptional growth in its Data Center business, which increased more than 70%, along with 20% growth in Broadband and renewed positive momentum in Electrical and Electronics Solutions. The company generated a record free cash flow of over $1 billion in 2024, representing 154% of adjusted net income, while reducing net debt by $431 million and purchasing $425 million of shares. Gross margin remained stable for the full year, though there was some pressure in communications and security solutions due to data center project deployments.
Looking ahead to 2025, WESCO International, Inc. (NYSE:WCC) expects organic sales growth of 2.5% to 6.5% with operating margin expansion across all three business units. The company is well-positioned to capitalize on secular trends, including AI-driven data centers, increased power generation, electrification, automation, and reshoring. Strategic portfolio moves, including the divestiture of the low-margin Integrated Supply business and the addition of higher-margin services businesses like Ascent, are integral to achieving WCC’s 10-plus percent EBITDA margin goals. The company plans to strengthen its balance sheet by fully redeeming outstanding preferred equity in June 2025, which is expected to improve both cash flow and EPS. Sell-side analysts estimate a 60.09% average upside for WCC, and it is, therefore, one of the best economic recovery stocks to consider.
5. Delta Air Lines, Inc. (NYSE:DAL)
Estimated average analysts’ upside: 65.25%
Revenue CAGR last 5 years: 20.28%
Number of Hedge Fund Holders: 84
Delta Air Lines, Inc. (NYSE:DAL) is a major global airline that operates passenger flights and cargo across six continents. The company operates over 4,000 daily flights to more than 275 destinations, with the busiest destinations being in the US. Beyond passenger services, DAL provides cargo transport, aircraft maintenance, repair, and overhaul services, as well as vacation packages. It is well-known that travel demand increases during economic recoveries, and DAL’s large scale and diversification across geographic regions makes it well-positioned to capture any acceleration in traffic.
Delta Air Lines, Inc. (NYSE:DAL) delivered record Q4 revenue of $14.4 billion, with pretax profit of $1.6 billion and earnings per share of $1.85, marking the largest December quarter profit in the company’s history. For the full year 2024, DAL achieved a return on invested capital of 13% that doubled the rest of the industry. The company generated $3.4 billion in free cash flow, a nearly $1.5 billion improvement over 2023, which supported debt reduction and a 50% increase in the quarterly dividend.
Looking ahead to 2025, Delta Air Lines, Inc. (NYSE:DAL) expects to deliver its best financial year in history with revenue growth and margin expansion record profitability, projecting EPS growth of over 20% on a YoY basis. The company is experiencing strong demand momentum across all segments, with corporate sales growing 10% YoY and American Express remuneration up 14% YoY. Management’s strategic focus includes expanding premium offerings, with more than 85% of incremental seats in 2025 planned for premium cabins while maintaining efficient growth across high-margin premium cabins in their most profitable hubs. We expect DAL to potentially surprise on growth during a broad market acceleration and hence include it in 5th place on our list of best economic recovery stocks to buy.
4. Shopify Inc. Class A Subordinate Voting Shares (NASDAQ:SHOP)
Estimated average analysts’ upside: 73.08%
Revenue CAGR last 5 years: 43.27%
Number of Hedge Fund Holders: 64
Shopify Inc. Class A Subordinate Voting Shares (NASDAQ:SHOP) is a multinational e-commerce company that provides a cloud-based platform on which businesses can create and manage online stores. The platform also offers complementary services like payment processing, marketing, shipping, and customer engagement tools. The company has managed to establish an almost complete ecommerce solution for businesses of all sizes and managed to attract even such giants like Mattel and Nestle. SHOP is exposed to the e-commerce sector fundamentals, which makes the company well-positioned to benefit from increased online retail activity during economic recoveries. The Canada-based company ranked 7th on our recent list of 10 Best SaaS Stocks to Buy According to Billionaires.
Shopify Inc. Class A Subordinate Voting Shares (NASDAQ:SHOP) delivered exceptional results in Q4 2024, with revenue growing 31% and achieving a 22% free cash flow margin, contributing to an annual revenue growth of 26% and an 18% free cash flow margin for the year. The company’s gross merchandise value (GMV) approached $300 billion, while revenue reached $9 billion for the year, representing nearly 2.5x more GMV and 3x more revenue compared to 2020. Operating income surpassed $1 billion for the year, which was 4x higher than the previous peak of $269 million in 2021.
Shopify Inc. Class A Subordinate Voting Shares (NASDAQ:SHOP) has significantly strengthened its market position, achieving over 12% of the US e-commerce market share while continuing rapid growth in regions like Europe and Japan. The company’s enterprise segment showed strong momentum, with major brands like Reebok launching on the platform. International expansion remained robust, with GMV growing 33% in Q4, led by 37% growth in EMEA, while the company maintained operational discipline by managing expenses to 32% of revenues. The Shop Pay commerce component has become a compelling entry point for enterprise brands, with GMV from this component surging nearly 20x in 2024.
SHOP is one of the best economic recovery stocks to own as both analysts and hedge funds signal strong confidence in the stock – average analysts’ upside stands at a whopping 73.08%, while 64 hedge funds own the stock as of Q4 2024.
3. Monolithic Power Systems, Inc. (NASDAQ:MPWR)
Estimated average analysts’ upside: 76.51%
Revenue CAGR last 5 years: 29.75%
Number of Hedge Fund Holders: 51
Monolithic Power Systems, Inc. (NASDAQ:MPWR) is a fabless semiconductor company designing high-performance and energy-efficient analog and mixed-signal integrated circuits (ICs) used in cloud computing, telecommunications, automotive, industrial, and consumer electronics. The company’s product portfolio is centered around DC-to-DC converters, AC-to-DC solutions, motor drivers, battery management systems, and sensors. MPWR’s presence across multiple high-growth and cyclical industries positions it to benefit from increased demand during economic recoveries.
Monolithic Power Systems, Inc. (NASDAQ:MPWR) achieved its 13th consecutive year of growth in 2024, posting full year revenue of $2.2 billion, representing a 21% increase from 2023. The company demonstrated strong performance in Q4 2024 with record quarterly revenue of $621.7 million, which was 37% higher than Q4 2023. This performance reflected the strength of their diversified market strategy, consistent execution, continued innovation, and strong customer focus.
Monolithic Power Systems, Inc. (NASDAQ:MPWR) is transforming from being a chip-only semiconductor supplier to a full-service silicon-based solutions provider, with several new product developments, including silicon carbide inverters, automotive audio products, and high-accuracy converters. The company also continues to invest in new technology, expand into new markets, and diversify its end market applications and global supply chain to capture future growth opportunities and maintain supply chain stability. With exposure to primarily cyclical end markets and 79.51% average upside estimated by analysts, MPWR ranks 3rd on our list of best economic recovery stocks to consider.
2. Stellantis N.V. (NYSE:STLA)
Estimated average analysts’ upside: 82.77%
Revenue CAGR last 5 years: 33.64%
Number of Hedge Fund Holders: 32
Stellantis N.V. (NYSE:STLA) is a multinational manufacturer of cars under 14 brands, including Abarth, Alfa Romeo, Chrysler, Citroën, Dodge, Fiat, Jeep®, Maserati, Opel, Peugeot, and others. With industrial operations in over 30 countries and a sales presence in more than 130 markets, STLA holds substantial market share and is one of the global automotive leaders. STLA’s broad brand portfolio, covering all price categories, as well as its global footprint, makes it the ideal automotive stock to benefit from increased consumer demand and economic activity during periods of economic recovery.
Stellantis N.V. (NYSE:STLA) experienced a challenging 2024, with an adjusted operating income margin landing at the bottom of the guided range of 5.5% to 7%. The company saw consolidated shipments decline by 750,000 units or 12%, with one-third attributed to inventory reduction actions and two-thirds related to lower sales and a temporary product hiatus. Net revenues declined 17% YoY, impacted by lower shipment volumes, mix effects particularly in North America, and FX headwinds in third engine regions.
Looking forward, Stellantis N.V. (NYSE:STLA) is prioritizing profitable growth, rigorous execution, and ensuring profitability converts into cash. The company has initiated several strategic actions, including empowering regions for closer customer proximity, launching 30 new products between 2024 and 2025, and extending product offerings across different powertrains to increase market coverage. For 2025, management expects revenue improvement compared to 2024, with a mid-single-digit operating margin and a return to positive industrial free cash flow, particularly in the second half of the year. With strong guidance ahead and a giant 82.77% average upside estimated by analysts, STLA is one of the best economic recovery stocks.
1. Las Vegas Sands Corp. (NYSE:LVS)
Estimated average analysts’ upside: 87.03%
Revenue CAGR last 5 years: 24.75%
Number of Hedge Fund Holders: 49
Las Vegas Sands Corp. (NYSE:LVS) is a global developer and operator of integrated resorts, offering luxury accommodations, gaming, entertainment, convention and exhibition facilities, celebrity chef restaurants, and high-end shopping. The company’s notable properties include, among others, Marina Bay Sands in Singapore and several resorts in Macau, which represent important destinations for both leisure and business travel, contributing significantly to the tourism appeal of their home country. Travel and tourism for both business and leisure tend to accelerate significantly during economic recoveries, making LVS an attractive investment during such periods.
Las Vegas Sands Corp. (NYSE:LVS) reported strong performance in Q4 2024, with the Macao market growing 6% compared to Q4 2023 and mass gaming revenue increasing by 5%. The company expects Macao’s gross gaming revenue to exceed $30 billion in 2025 and continue growing. In Singapore, Marina Bay Sands delivered exceptional results with $537 million in adjusted property EBITDA, while mass gaming reached $746 million, reflecting 71% growth compared to Q4 2019 and 28% growth YoY.
Las Vegas Sands Corp. (NYSE:LVS) is nearing completion of significant capital investments across its portfolio, with the Londoner renovation expected to be fully completed by May 2025, bringing the total to 1,500 suites and 905 rooms. In Singapore, the $1.75 billion refurbishment program at Marina Bay Sands will be substantially completed by May 2025, with early results showing strong returns on investment. The company demonstrated a commitment to shareholder returns by repurchasing $450 million of LVS stock during the latest quarter and increasing the annual dividend to $1 per share for 2025.
Overall LVS ranks first on our list of the 10 best economic recovery stocks to buy. While we acknowledge the potential of LVS to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than LVS but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
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