In this article, we will take a look at the 10 Best Breakout Stocks to Invest In.
The US stock market is running high, hitting record highs, bolstered in part by continued optimism around artificial intelligence. The S&P 500 has soared 15% year-to-date and has found support above the 200-day moving average over the past two years. Likewise, the technology-heavy NASDAQ 100 is up 20% heading into year-end, arousing valuation concerns in some quarters.
Amid the blockbuster gains, professional investors are increasingly locking in profits, resulting in significant pullbacks close to key technical levels. Bank of America touts retail investors as the backbone behind the recent dip buying. The strategy has paid off handsomely as the S&P 500 has rallied to record highs.
The rally in the equity markets is set to persist despite concerns about valuation. This sentiment is echoed by Morgan Stanley’s Michael Wilson, who expects solid earnings to propel US stocks to new heights in 2026.
“While overhangs from Federal Reserve guidance and the shutdown have weighed on recent price action, these are temporary headwinds on the way to a solid 2026 driven by earnings growth,” Wilson wrote in a note.
The US equity markets have surged to record highs, shrugging off worries about President Donald Trump’s trade war, tariffs, and signs of a cooling economy. Similarly, strategists at Goldman Sachs, Deutsche Bank, and other firms have struggled to improve their outlooks as equities have reached record highs.
“Analysts have a tendency to be conservative going into earning season, but they were particularly conservative this time, and I think the same goes for strategists,” said Wall Street veteran Ed Yardeni of eponymous firm Yardeni Research. “I’ve been a cheerleader for the resilience of the economy and even I’ve been surprised that earnings — profit margins — haven’t really flinched in the face of Trump’s tariffs.”
With the overall market remaining bullish, let’s take a look at some of the best breakout stocks to invest in.
Our Methodology
To identify the top breakout stocks to invest in, we used the Finviz screener to screen for stocks that have breached the 200-day moving average. We settled on stocks breaking out above the 200-day moving average on high trading volume, which is more than twice the three-month average. We further refined the list by selecting stocks with a relative volume greater than 2, meaning their current trading volume is at least twice the three-month average, indicating heightened market activity and potential investor interest. To assess institutional backing, we ranked the selected stocks in ascending order according to the scale of hedge fund ownership reported in the second quarter of 2025.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research shows 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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
Best Breakout Stocks to Invest In
10. Benitec Biopharma Inc. (NASDAQ:BNTC)
Share Price as of November 14: $13.29
200-Day Simple Moving Average: $13.45
Relative Volume: 2.13
Number of Hedge Fund Holders: 9
Benitec Biopharma Inc. (NASDAQ:BNTC) is one of the best breakout stocks to invest in. On November 4, an analyst at Citizens JMP raised the stock’s price target to $22 from $20 while reiterating an Outperform rating. The price target hike follows topline clinical data results that showed a 100% response rate for BB-301 in Phase 1b/2a of the treatment for Oculopharyngeal Muscular Dystrophy (OPMD), a rare genetic muscle-wasting disease.
The US Food and Drug Administration has already granted the company Fast Track designation for the gene therapy following the positive interim results. In the trials, the treatment successfully reduced swallowing difficulties in patients and shortened the time required to consume liquids.
“We are excited by the profound effect that BB-301 can potentially have on this progressive disease as demonstrated by the interim clinical trial results for Cohort 1, where 100% of patients were responders” said Jerel A. Banks, M.D., Ph.D., Executive Chairman and Chief Executive Officer of Benitec Biopharma Inc. “Securing Fast Track designation for BB-301 reflects the strength of our clinical data and the urgency of the unmet need in OPMD. “
Meanwhile, on November 11, Suvretta Capital Management and related entities announced a $20 million investment in Benitec Biopharma.
Benitec Biopharma Inc. (NASDAQ:BNTC) is a clinical-stage biotechnology company that develops novel genetic medicines using its proprietary DNA-directed RNA interference (ddRNAi) platform. Its platform combines gene therapy and RNA interference to create treatments that silence disease-causing genes and simultaneously replace them with functional, wild-type genes after a single administration.
9. Arcos Dorados Holdings Inc. (NYSE:ARCO)
Share Price as of November 14: $7.59
200-Day Simple Moving Average: $7.44
Relative Volume: 2.37
Number of Hedge Fund Holders: 15
Arcos Dorados Holdings Inc. (NYSE:ARCO) is one of the best breakout stocks to invest in. On November 11, JPMorgan lowered its price target for the stock to $8.70 from $8.80, despite the company delivering strong third-quarter results while navigating challenging consumer dynamics.
Total revenue in the quarter rose 12.7% to $1.2 billion, in line with blended inflation. The revenue increase was driven by strong growth in Argentina and Mexico. Additionally, Arcos Dorados Holdings Inc. (NYSE:ARCO) benefited from an aggressive marketing strategy and a digital approach that supported sales growth. Digital channels were up 11.2% in the quarter.
It also generated $201.1 million in adjusted EBITDA, an improvement from $125 million in the same quarter last year. Arcos Dorados Holdings’ third-quarter earnings per share more than quadrupled to $0.71 compared to $0.17 delivered in the same quarter the previous year.
“During the third quarter of 2025, we successfully navigated challenging consumer dynamics to generate balanced US dollar revenue growth and solid profitability. We are focused on exceeding guests’ expectations in today’s business while modernizing and improving our growth processes to support higher returns on investment and to ensure Arcos Dorados maintains its leadership position for many years to come,” said CEO Luis Raganato.
Arcos Dorados Holdings Inc. (NYSE:ARCO) is the world’s largest independent McDonald’s franchisee, operating the brand’s restaurants in 21 countries and territories across Latin America and the Caribbean. The company owns, operates, and sub-franchises McDonald’s locations and is responsible for managing their operations, marketing, and expansion.
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