In this article, we will take a look at the 12 best growth stocks under $25 to buy now.
AI is the Most Defining Theme of 2025, Says Expert
Most experts agree that the AI wave is not over yet. On January 8, Wendy Sheehan Donnell, Editor-in-Chief at PCMag, joined Yahoo Finance from CES 2025 to share her take on trending innovations and the increasing role of artificial intelligence in revolutionizing industries.
Donnell unveiled some of the groundbreaking innovations spearheaded by companies from across the globe and emphasized that “AI is the prevailing theme” across all these new products and services. She highlighted the incidence of AI-powered home devices such as smart microwaves and fridges to help people live smarter and tech-immersed lives. She also shed light on the growing role of AI in healthcare and biotechnology, which will contribute to the well-being of people.
A Glance at the Tech Sector in 2025
The market close on Tuesday reiterated a similar pattern where tech stocks continued to shine, however, some analysts expect the market to broaden over the course of 2025. On January 7, Joe Mazzola, head trading and derivatives strategist at Charles Schwab, joined Yahoo Finance, to discuss his market thesis for the tech sector especially.
Mazzola suggested that the market breadth was of importance in the earnings season, and pointed towards the strengthening of the US dollar and how it may impact the earnings of tech names. He added that the market needs the other “493 names” in the S&P 500 to catch up. Mazolla also emphasized that while 2025 can be a win for Big Tech like 2024, a broadening would help the overall market immensely in terms of earnings.
He added that the financials sector would supposedly catalyze the broadening of the market, because of favorable economic and market conditions. He then discussed the tailwinds for financials and how the same factors serve as headwinds to Big Tech, emphasizing that the bullishness on tech has been slower than it was at the end of 2024.
Now that we have studied the growing importance of AI across every industry, let’s take a look at some of the cheaper names driving this revolution.
A scientist in a lab conducting research on cell-based therapeutics and biotechnology.
Our Methodology
We used Finviz to look for companies operating in growth sectors such as technology, financials (fintech), biotech, and communication services. We only focused on companies with a market cap of at least $2 billion and that gained more than 50% over the past 2 quarters. We then examined the hedge fund sentiment surrounding 25 stocks and picked the 12 stocks that were the most widely held by hedge funds.
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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
12 Best Growth Stocks Under $25 to Buy Now
12. LendingClub Corporation (NYSE:LC)
Number of Hedge Fund Holders: 21
Share Price as of January 8, 2024: $15.9
LendingClub Corporation (NYSE:LC) is a financial services company that offers personal loans and full-service banking facilities. Some of its services include debt paydown loans, cash loans, medical loans, and auto loan refinancing. So far, the company has helped over 5 million people reach their financial goals and expects its customer base to grow further. The digital marketplace bank has gained immense traction for its unique banking system that connects borrowers with investors with absolutely no brick-and-mortar presence.
In the third quarter of 2024, LendingClub Corporation (NYSE:LC) grew its assets by 25% year-over-year which is primarily driven by the purchase of LendingClub loans worth $1.3 billion. In addition to its solid fundamentals, the company is also expanding its presence through strategic partnerships and acquisitions. For instance, in October 2024, LC acquired Tally’s Technology to expand its product roadmap.
Its liquidity situation coupled with its growing customer base positions LC as an emerging leader in the fintech industry, which also contributes to its ranking on our list. Investors are also placing their bets on the stock as the easing cycle is executed in full action.
11. Aurora Innovation, Inc. (NASDAQ:AUR)
Number of Hedge Fund Holders: 22
Share Price as of January 8, 2024: $8.39
Aurora Innovation, Inc. (NASDAQ:AUR) is a software company behind Aurora Driver, a computer system that is used for autonomous driving. The system is designed in a way that cars are able to see and comprehend roads and traffic to ensure safe travel. The company has partnered with prominent names in the vehicle manufacturing and logistics industry which include Volvo, Paccar, Toyota, Uber Freight, FedEx, and Schneider.
Aurora Innovation, Inc. (NASDAQ:AUR) made significant progress in 2024, building momentum for the historic commercial launch of its autonomous trucking service in April 2025. As per its latest report on December 18, the company announced that its “Safety Case” for its driverless trucking products is 97% complete. Uber Freight, Schneider, and Hirschbach, among other names, have already signed up for the autonomous trucking services, marking an incredible feat for AUR.
The company’s launch capacity is already contracted, making the future of Aurora Innovation, Inc. (NASDAQ:AUR) quite promising and attractive to investors. Analysts are also bullish on the stock and their high price target represents an upside of 24% from current levels.
10. Sportradar Group AG (NASDAQ:SRAD)
Number of Hedge Fund Holders: 24
Share Price as of January 8, 2024: $18.15
Sportradar Group AG (NASDAQ:SRAD) is a sports technology company based in Switzerland. The company analyzes, manages, and collects data for bookmakers, sports federations, and media companies. Some of its prominent clients include the National Basketball Association, the ATP Tour, NASCAR, and UEFA, to name a few. During the third quarter of 2024, the company increased its revenue by 27% to EUR 255 million. During the same period, the company reported a profit worth EUR 37 million. In addition to profitability, Sportradar Group AG (NASDAQ:SRAD) also boasts a remarkable liquidity situation, with its free cash flow strengthening its balance sheet and bolstering business growth.
The company drove most of its revenue from its betting technology and solutions segment, which reached EUR 210 million in revenue and grew by 32% year-over-year. In addition to that, its customer base in the United States proved to be very important for the company, with revenues from the US growing by 46% year-over-year. Customer retention rate also grew tremendously, by nearly 126%, during the quarter, demonstrating SRAD’s strength in retaining and expanding its customer base.
Sportradar Group AG (NASDAQ:SRAD) is not only progressing on the financial front, but it is emerging as a prominent name in the industry because of its strong partnerships with sports organizations and innovative product lineup for the 2024-2025 season. This combined with its solid fundamentals explains why 24 hedge funds were bullish on the stock at the close of Q3 2024.
9. ADMA Biologics, Inc. (NASDAQ:ADMA)
Number of Hedge Fund Holders: 25
Share Price as of January 8, 2024: $18.29
ADMA Biologics, Inc. (NASDAQ:ADMA) ranks ninth on our list of the best growth stocks under $25 to buy now. The biotechnology company is an end-to-end biopharmaceutical company that is driving the launch of plasma-based products using immunotechnology. So far the company has 3 FDA-approved products, aligning with its goal of commercializing specialty biologics for the treatment of infectious diseases and immune-compromised patients.
As a result of its commercialization, in the third quarter of 2024, ADMA Biologics, Inc. (NASDAQ:ADMA) logged revenue worth $119.8 million, up by 78% year-over-year. Net income during the same quarter reached $35.9 million, a whopping 1,300% increase from the same period in 2023. Consequently, the company raised its full-year guidance for revenue and net income, emphasizing its sound financial position.
The company has also strengthened its governance over time, contributing to its position on our list and as a favorite among investors. Recently the company onboarded and partnered with KPMG as a registered public accounting firm. This emphasizes the company’s growing financial position and market value.
8. Lumen Technologies, Inc. (NYSE:LUMN)
Number of Hedge Fund Holders: 26
Share Price as of January 8, 2024: $5.55
Lumen Technologies, Inc. (NYSE:LUMN) is a telecommunications company offering cloud solutions, network services, security services, and other managed services. The company offers its services to multiple leading names such as Zoom, Vikings, VSP Vision, Seattle Seahawks, BlackStar Group, and Horizon Bank. Over the past few months, the company has expanded its services and line-up by partnering with key stakeholders in the technology sector.
For instance, on November 5, Lumen Technologies, Inc. (NYSE:LUMN) announced a partnership with Google Cloud to speed up its digital transformation and innovation process. The partnership will allow Lumen to power AIOps and provide data insights across its network using Google Cloud. Similarly, in October, LUMN announced a partnership with Meta to help the company accelerate its AI goals.
The company’s partnerships and collaborations with tech giants have significantly boosted its position in the industry. In addition to that, the advent of AI has pushed the stock higher. 26 hedge funds were bullish on the stock at the end of Q3 2024.
7. Genius Sports Limited (NYSE:GENI)
Number of Hedge Fund Holders: 27
Share Price as of January 8, 2024: $8.8
Genius Sports Limited (NYSE:GENI) ranks seventh on our list of the best growth stocks to buy now under $25. The sports-based data and technology company provides several key services such as data management, video streaming, and integrity services to sports leagues. GENI was founded in 2001 and is committed to making sports smarter for fans and teams. Companies and organizations like the NFL, Coca-Cola, and the Premier League use the services of GENI to place the right ads at the right time, drive fan engagement, and increase efficiency.
It is no surprise that Genius Sports Limited (NYSE:GENI) is using artificial intelligence to enhance its offerings. The company is able to transform millions of data points into insights in readable formats such as videos, visuals, and data charts. Moreover, its data and video analysis software allows coaches with powerful insights to master crucial decision-making. In addition to that, the Genius monitoring system is also able to detect any suspicious betting activity using its predictive algorithms.
27 hedge funds were bullish on the stock at the close of Q3 2024, and that is primarily because of GENI’s growing popularity in the sports industry which is also expected to grow immensely over time due to solid partnerships with big names. In addition to its strong position, the company is also becoming a data and technology powerhouse, setting it apart from its competitors.
Choice Equities Capital Management stated the following regarding Genius Sports Limited (NYSE:GENI) in its Q3 2024 investor letter:
“CZR and Genius Sports Limited (NYSE:GENI) – Both Caesars Entertainment, Inc. and Genius Sports Limited operate in and around the entertainment, casino and gaming space. Caesars is a bit more well-known and discussed in brief below. Genius is not as well-known but possesses a bright future as a fast-growing company that has become a critical cog in the sports betting value chain. The company has exclusive data rights deals with many leagues including the English Premier League and the NFL (which owns an equity stake in the company) which afford the company the right to collect, synthesize and share pre-game and in-game data with their casino and sportsbook partners to generate betting lines. A more in-depth memo has been attached for existing investors.”
6. Remitly Global, Inc. (NASDAQ:RELY)
Number of Hedge Fund Holders: 29
Share Price as of January 8, 2024: $23.21
Remitly Global, Inc. (NASDAQ:RELY) is a financial services company that allows people to send and receive money online from the United States. The company has a motive to help immigrants in the United States support their families back home, enhancing the sentimental value associated with the brand. In addition to that, the company also funds charities and programs to enhance the financial and social position of immigrants in the United States and their families. Over the years, the company has expanded to Europe, partnered with prominent names, and urged state organizations to enhance the financial and social inclusion of immigrants.
Aligning with its goals, Remitly Global, Inc. (NASDAQ:RELY) is leveraging machine learning to prevent fraud and minimize interventions. The company uses ML models to assess and detect thousands of transactions every hour, allowing them to prevent identity theft and credit card fraud with precision. In 2023, the company has been able to reduce the rate of fraud by more than 25% compared to 2022. At the same time, the company saw a 30% decline in its rate of transaction loss. Similarly, on December 10, the company launched a Trust and Safety Center in partnership with Get Safe Online to educate users on fraud and scams online.
Investors are bullish on the stock because of its fundamentals, expanding market share, and a solid growth trajectory. Night Watch Investment Management stated the following regarding Remitly Global, Inc. (NASDAQ:RELY) in its Q4 2024 investor letter:
“The US consumer has been in a 2-year affordability crisis. As a result, there are many quality consumer businesses available at very attractive prices. However, we don’t currently see a reason why US consumer spending should rebound from its current depressed level. We will therefore limit ourselves to companies with company-specific growth drivers. An example is Remitly Global, Inc. (NASDAQ:RELY) which we acquired around $13 after the stock sold off excessively on an earnings miss in Q1, despite the 30% growth on the back of market share gains. Valuation is very attractive when considering that marketing expenses are a discretionary reinvestment into the business.”
5. BrightSpring Health Services, Inc. (NASDAQ:BTSG)
Number of Hedge Fund Holders: 21
Share Price as of January 8, 2024: $17.34
BrightSpring Health Services, Inc. (NASDAQ:BTSG) is a healthcare company that provides a wide variety of home and community-based health services to people. The company offers electronic health record solutions, data analytics and reporting, smart home monitoring, telehealth services, and care management to patients when they need it. In 2023 alone, the company filled 37 million prescriptions for polypharmacy patients and has over 900 locations across all its service lines.
BrightSpring Health Services, Inc. (NASDAQ:BTSG) attributes its position to its expansion strategy comprised of acquisitions and mergers. In the past few months, the company has formed several partners for the development of new drugs and specialist pharmacies. In September, the company announced an agreement to acquire Haven Hospice which delivers comprehensive hospice care across 18 counties in Florida. The acquisition will allow BTSG to offer advanced care planning and hospice services in Florida.
The company’s position in the industry is evident from the fact that it offers solutions across all 50 states in the United States to more than 400,000 customers, clients, and patients every day. However, with such a mature position, the company is still committed to expanding, and this is one of the primary reasons for it to be on our list.
4. SoFi Technologies, Inc. (NASDAQ:SOFI)
Number of Hedge Fund Holders: 31
Share Price as of January 8, 2024: $14.91
SoFi Technologies, Inc. (NASDAQ:SOFI) is an emerging fintech company that ranks fourth on our list of the best growth stocks under $25 to buy now. The personal finance and financial technology company was founded in 2011 and has now grown to provide technology solutions to other financial institutions and individuals. As of today, the company has over 10 million members and has paid a whopping $73 billion in funded loans.
The company has displayed consistent performance on the financial front, explaining why 31 hedge funds were bullish on the stock at the close of Q3 2024. During the quarter, the company recorded revenue worth $697 million and net income worth $61 million. Revenue grew by 30% which was primarily driven by the 64% increase in the financial services and tech platform segments, making up 49% of the total revenue. In addition to that, SoFi Technologies, Inc. (NASDAQ:SOFI) posted a 35% increase in members, which is attributed to its investment in product innovation.
As a consequence of these results, SoFi Technologies, Inc. (NASDAQ:SOFI) raised its fiscal year 2024 guidance while also fueling investor expectations. The company is not only working to improve its financial standing but it is also committed to increasing its customer base through a wider range of product offerings.
3. Wave Life Sciences Ltd. (NASDAQ:WVE)
Number of Hedge Fund Holders: 34
Share Price as of January 8, 2024: $13.08
Wave Life Sciences Ltd. (NASDAQ:WVE) is a biotechnology company that develops drugs to treat genetic diseases, conventionally deemed as untreatable. The company’s prowess lies in its innovative approach which leverages RNA-targeting modalities to treat disorders. Over the past few months, the company has delivered solid performance by accelerating trials and expanding its drug portfolio.
As a result, the company posted solid financial results in the third quarter of 2024, with revenue worth $7.7 million. While the company saw a decline in revenue from the third quarter of 2023, WVE expects that this will not impact its future progress and suggests that its performance is in line with its goals. Research and development costs during the same period were recorded at $41.2 million, up from $31.6 million in the same quarter of 2023.
Investors are bullish on the stock because of incoming positive data from trials, which also led the stock to gain value. Its preliminary data has proven to be quite promising, fueling shared optimism among investors and analysts despite weak financials.
2. Centessa Pharmaceuticals plc (NASDAQ:CNTA)
Number of Hedge Fund Holders: 34
Share Price as of January 8, 2024: $17.32
Centessa Pharmaceuticals plc (NASDAQ:CNTA) ranks second on our list of the best growth stocks under $25 to buy now. The biotechnology company is currently conducting trials of drugs for patients with neurological, neurodegenerative, and psychiatric disorders. In the third quarter of 2024, the company made quite some progress with its trials by announcing interim data from a phase 1 trial for its novel orexin receptor 2 (OX2R) and initiated phase 2 trials for its ORX750 drug.
The company believes its strength lies in its OX2R agonist program, offering treatment for a wide range of disorders. In addition to its revolutionary drug, Centessa Pharmaceuticals plc (NASDAQ:CNTA) also halted the global clinical development of its SerpinPC drug, resulting in nearly $200 million in net savings. These savings will be allocated to its OX2R drug franchise. The company spent nearly $33.9 million in research and development in Q3 2024, up from $28.2 million during the same period in 2023, and had $518.4 million in cash and cash equivalents at the end of the quarter.
Centessa Pharmaceuticals plc (NASDAQ:CNTA) expects to use their long and short-term cash resources to fund their operations into mid-2027 before they start reporting a profit. Investors are bullish on the stock because of its future growth potential and the current pace of its operations is contributing to that.
1. Unity Software Inc. (NYSE:U)
Number of Hedge Fund Holders: 35
Share Price as of January 8, 2024: $23.08
Unity Software Inc. (NYSE:U) provides a game engine that allows people to create 3D games, 2D games, and interactive simulations. The gaming industry is growing immensely, which can explain the growth of companies like Unity Software. As a result, the company has over 1.1 million active users and 3.7 billion downloads per month, especially because of its end-to-end offering, setting it apart from competitors. In addition to that, more than 70% of the top 1,000 mobile games, 25% of the top 1,000 PC games, and 87% of the top 100 games are made with Unity.
Other than supportive environmental and demand conditions, Unity Software Inc. (NYSE:U) is also increasingly pouring into AI to enhance the game development process, user precision, and customer support. Its latest release, Unity 6 offers faster rendering, powerful lighting options, complete multiplayer workflows, and advanced AI capabilities. It is also more stable and allows users to develop dynamic AI experiences across all Unity platforms using Sentis, a neural network inference library, that allows users to import, optimize, and run AI models to suit their needs.
Unity Software Inc. (NYSE:U) has posted a strong start to 2025, growing by 1.5% over the past five days. Investors are bullish on the stock because of the consistency U has displayed over time; beating revenue expectations and turning its managerial strategy around to meet future goals.
While we acknowledge the potential of U to grow, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than U but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
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