In this article, we will take a look at 10 High Growth High Margin Stocks to Buy Now.
U.S. stock markets have struggled to come out of their recent slump, with the S&P 500 remaining virtually unaffected over the previous month as an elevated level of increases from areas other than technology limit advances for the benchmark and drags on the market’s overall performance. That said, the market’s general performance in 2026 has been defined by a constant shift into non-tech industries like consumer staples, industrials, and energy, most of which have posted gains exceeding 4% over the second week of February along with double-digit percentage gains since the beginning of the year.
In addition, technology stocks pushed the S&P 500 to soar on February 9, with the Dow Jones Industrial Average hitting all-time highs. The improvements come after the main indexes recovered on February 6, with the Dow surpassing 50,000 for the very first time, after experiencing significant losses earlier that week.
Sam Stovall of CFRA Research discussed the tech industry’s forward price-to-earnings ratio in relation to its average over the last five years. He said the following:
“We went from a 17% premium to an 8% discount. You could say, ‘Well, gee, that’s pretty good, and so maybe it’s time not to bail out on technology just yet.”
Our Methodology
For this list, we used stock screeners to compile a list of companies with a trailing twelve-month (TTM) operating margin above 25%, signaling strong operational efficiency and pricing power. This list was further filtered for companies that boast a 5-year revenue growth rate of at least 20%, thus indicating solid growth. In addition, we ranked these stocks based on the number of hedge funds invested in each of them as of Q3 2025.
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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
10. Monolithic Power Systems, Inc. (NASDAQ:MPWR)
Operating Margin (TTM): 26.11%
5-Year Revenue Growth Rate: 27.00%
Number of Hedge Fund Holders: 42
Monolithic Power Systems, Inc. (NASDAQ:MPWR) ranks among the best high growth high margin stocks to buy now. On February 6, KeyBanc boosted its price target for Monolithic Power Systems, Inc. (NASDAQ:MPWR) to $1,500 from $1,300, retaining an Overweight rating on the company’s shares. The boost comes after the company’s fourth-quarter results and first-quarter forecasts, which KeyBanc defined as “strong”. Notably, Monolithic Power Systems, Inc. (NASDAQ:MPWR) raked in a record quarterly revenue of $751.2 million, exceeding expectations of $740.23 million.
KeyBanc stated that the company’s fourth-quarter momentum was prominent in the Data Center division, which produced substantial year-over-year growth spanning Enterprise Data, Computing & Storage, and Communications.
Given the strong market demand and share gains, the firm noted that Monolithic Power Systems, Inc. (NASDAQ:MPWR) has raised its 2026 Enterprise Data growth expectation from an earlier projection of 35% to more than 50%, though it considers this goal to be conservative.
Monolithic Power Systems, Inc. (NASDAQ:MPWR) produces and markets small, ultra-efficient, user-friendly power management systems for various industries, including computers, automotive, data centers, and communications.
9. Royal Caribbean Cruises Ltd. (NYSE:RCL)
Operating Margin (TTM): 27.50%
5-Year Revenue Growth Rate: 52.02%
Number of Hedge Fund Holders: 47
Royal Caribbean Cruises Ltd. (NYSE:RCL) ranks among the best high growth high margin stocks to buy now. On January 29, Royal Caribbean Cruises Ltd. (NYSE:RCL) announced earnings for the fourth quarter of 2025, meeting analyst projections of $2.80 per share. Following the announcement, Royal Caribbean Cruises Ltd. (NYSE:RCL) stated predictions of a double-digit rise in revenue and a 14% increase in full-year adjusted EPS in 2026, with estimates ranging from $17.70 to $18.10.
Meanwhile, on February 2, JPMorgan hiked its price target for Royal Caribbean Cruises Ltd. (NYSE:RCL) to $371 from $368 and retained an Overweight rating on the company’s shares. The firm described Royal Caribbean as being the “best-in-class operator” in the cruise sector, highlighting a number of unique selling points in its analysis.
Additionally, the firm highlighted its competitive destination portfolio, touting Perfect Day at Cococay as an experience which “can compete head to head with land-based alternatives.”
Royal Caribbean Cruises Ltd. (NYSE:RCL) is a global cruise company that operates under the Royal Caribbean International, Celebrity Cruises, and Silversea Cruises brands, among others, and offers a wide range of itineraries.
8. Agnico Eagle Mines Limited (NYSE:AEM)
Operating Margin (TTM): 49.75%
5-Year Revenue Growth Rate: 27.13%
Number of Hedge Fund Holders: 57
Agnico Eagle Mines Limited (NYSE:AEM) ranks among the best high growth high margin stocks to buy now. On February 4, CIBC raised its price target for Agnico Eagle Mines Limited (NYSE:AEM) to $296 from $231 while maintaining an Outperform rating on the company’s shares. The boost came as the firm lifted its targets over the precious metals group after raising its gold price projections to $6,000 per ounce in 2026 and $6,500 in 2027. According to the firm, similar demand factors as in 2025 will continue to exist in 2026, though there is more geopolitical instability.
Meanwhile, on January 29, JPMorgan began coverage of Agnico Eagle Mines Limited (NYSE:AEM) with a Neutral rating and a $248 price target, dubbing it the world’s second largest gold mining company, with production estimated to be about 3.4 million ounces this year.
The firm cited management’s history of operational competence, calling Agnico Eagle Mines Limited (NYSE:AEM) a “reliable, low-risk vehicle to gain leverage to gold” that has a 95% correlation over a decade.
Agnico Eagle Mines Limited (NYSE:AEM), a global gold producer, operates mines across Canada, Australia, Finland, and Mexico.
7. Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX)
Operating Margin (TTM): 38.76%
5-Year Revenue Growth Rate: 21.61%
Number of Hedge Fund Holders: 61
Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) ranks among the best high growth high margin stocks to buy now. On January 28, Barclays began coverage of Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) with an Overweight rating and a $606 price target, voicing confidence about Vertex’s renal franchise, implying that it might achieve significant market attention in 2026 and perhaps follow the success established by the company’s cystic fibrosis (CF) operation. The firm emphasized that Vertex’s CF therapies continue to rake in significant cash flows, which could allow for future commercial development.
Barclays expects Vertex’s IgAN (immunoglobulin A nephropathy) program to yield encouraging results early this year, adding that the renal franchise’s prospects continue to be “underappreciated” by the market.
Barclays also mentioned Journavx, claiming that the increase in prescriptions and revenues in 2026 has lately been “overlooked” by the market.
Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) is a global biotechnology company. It develops and commercializes therapies for serious diseases, with a primary focus on cystic fibrosis and genetic disorders.
6. Coinbase Global Inc. (NASDAQ:COIN)
Operating Margin (TTM): 44.94%
5-Year Revenue Growth Rate: 65.18%
Number of Hedge Fund Holders: 73
Coinbase Global Inc. (NASDAQ:COIN) ranks among the best high growth high margin stocks to buy now. On January 28, Baird began coverage of Coinbase Global Inc. (NASDAQ:COIN), rating it Neutral and setting a price target of $240 on the company’s shares. The firm sees Coinbase Global Inc. (NASDAQ:COIN) as “a strong franchise and solid growth story,” citing its status as the largest bitcoin exchange in the US, as well as providing retail and institutional trading capabilities with increasing applications.
Baird stated that the risk-reward ratio for COIN shares appears balanced, referencing recent trading volume declines after the October 10 cryptocurrency price slump and concerns regarding the Clarity Act.
However, the firm highlighted a number of possibilities for growth for Coinbase Global Inc. (NASDAQ:COIN), namely its “Everything Exchange” program and enhancing subscription revenue mix, and added that it planned to “wait for an incremental pullback to upgrade” its outlook.
Coinbase Global Inc. (NASDAQ:COIN) is a leading US-based financial technology company that operates a major cryptocurrency exchange platform enabling individuals and institutions to buy, sell, trade, store, and stake digital assets like Bitcoin and Ethereum.
5. Robinhood Markets Inc. (NASDAQ:HOOD)
Operating Margin (TTM): 47.85%
5-Year Revenue Growth Rate: 60.71%
Number of Hedge Fund Holders: 77
Robinhood Markets Inc. (NASDAQ:HOOD) ranks among the best high growth high margin stocks to buy now. Truist Securities reduced its price target for Robinhood Markets Inc. (NASDAQ:HOOD) to $130 from $155 on February 6, keeping a Buy rating on the company’s shares. Despite the cut, Truist warned that the market reaction could be overblown, considering that crypto accounts for just 19% of Robinhood’s revenue and 12% of its projected growth for the year.
The firm voiced optimism that Robinhood Markets Inc. (NASDAQ:HOOD) will maintain solid financial performance in a weak crypto market, estimating that the company might reach 7% revenue growth and over $2.00 earnings per share in 2026 even if bitcoin revenue is completely removed.
This follows Truist’s previous price estimate of $155 on February 3, which came after Robinhood Markets Inc. (NASDAQ:HOOD) shares plunged 10% on February 2, lagging the broader market, which was slightly up. The selloff coincided with a 7% decline in Bitcoin prices, though financial sector equities moved higher and capital markets stocks stayed relatively steady.
Robinhood Markets Inc. (NASDAQ:HOOD) operates a financial services platform in the US. Its platform allows users to invest in stocks, ETFs, American depository receipts, options, gold, and cryptocurrencies.
4. Palantir Technologies Inc. (NASDAQ:PLTR)
Operating Margin (TTM): 31.59%
5-Year Revenue Growth Rate: 32.58%
Number of Hedge Fund Holders: 81
Palantir Technologies Inc. (NASDAQ:PLTR) ranks among the best high growth high margin stocks to buy now. On February 3, UBS reduced its price target for Palantir Technologies Inc. (NASDAQ:PLTR) to $180 from $205, while keeping a Neutral rating on the company’s shares. The revision follows what UBS claimed was the company’s “astounding” financial performance, which included 70% total revenue growth and 137% increase in U.S. commercial revenues on a level surpassing $2 billion.
Palantir’s U.S. government operations, mainly Department of Defense deals, increased by 66% amid cost-cutting demands in the industry. According to UBS, Palantir’s financial success is unique in the software industry, since “no other public software company has financials close to that of Palantir.”
Truist Securities also confirmed its Buy rating on Palantir Technologies Inc. (NASDAQ:PLTR), citing the company’s impressive performance as a “AI pure-play victor” and adding that sales growth surged for the tenth straight quarter, hitting an annual revenue scale of more than $4 billion.
Palantir Technologies Inc. (NASDAQ:PLTR) is a software company that provides platforms to help organizations integrate, manage, and secure large datasets for human-driven analysis. Its two primary platforms are Gotham, used by government and defense agencies for intelligence and defense operations, and Foundry.
3. AppLovin Corporation (NASDAQ:APP)
Operating Margin (TTM): 64.13%
5-Year Revenue Growth Rate: 36.49%
Number of Hedge Fund Holders: 110
AppLovin Corporation (NASDAQ:APP) ranks among the best high growth high margin stocks to buy now. Deutsche Bank stated on February 2 that it thinks AppLovin Corporation (NASDAQ:APP)’s risk-reward profile has “meaningfully improved” after a considerable stock selloff brought on by Google’s Project Genie announcement. The news raised investor worries about potential disruptions for game engine developers, platforms, and publishers, AppLovin Corporation (NASDAQ:APP) being among them.
According to Deutsche Bank analysts, Project Genie has the potential to streamline game development by serving as a “generative game engine,” enabling individuals with basic coding skills to create games and perhaps cutting development time for gaming companies.
Despite market fears, Deutsche Bank believes it is “far too early” to predict how disruptive Genie could end up being. The firm anticipates that Genie will improve the game creation process and boost game content generation, which “should ultimately serve to enhance the advertising businesses for both Unity and Applovin.”
AppLovin Corporation (NASDAQ:APP) is a software-based advertising and app monetization company. It operates through two segments, Advertising and Apps. The company also develops and publishes free-to-play mobile games through its studios and partners.
2. Eli Lilly & Company (NYSE:LLY)
Operating Margin (TTM): 45.56%
5-Year Revenue Growth Rate: 21.58%
Number of Hedge Fund Holders: 114
Eli Lilly & Company (NYSE:LLY) ranks among the best high growth high margin stocks to buy now. Deutsche Bank retained its Buy rating and $1,200 price target for Eli Lilly & Company (NYSE:LLY) on February 4, citing the pharmaceutical giant’s strong fiscal year 2026 projections.
Eli Lilly & Company (NYSE:LLY) posted revenues of around $19.3 billion in the fourth quarter of 2025, exceeding Street projections of $18 billion, thanks mostly to strong results from its diabetes and obesity drugs Mounjaro and Zepbound.
The company announced fiscal year 2026 revenue forecast of $80-$83 billion and non-GAAP EPS forecasts of $33.50-$35.00 per share, beating the analyst average projections of $78 billion in revenue and $33.09 per share.
Eli Lilly & Company (NYSE:LLY) further confirmed the introduction of Orforg in the US in Q2 2026 as well as the implementation of Medicare’s obesity coverage on July 1, 2027, in addition to the submission of Orforg’s European file for Type 2 diabetes.
Eli Lilly & Company (NYSE:LLY) is a major global pharmaceutical company that develops, manufactures, and distributes a wide range of drugs. Founded in 1876, it has grown to become one of the world’s largest pharmaceutical companies.
1. NVIDIA Corporation (NASDAQ:NVDA)
Operating Margin (TTM): 58.84%
5-Year Revenue Growth Rate: 64.24%
Number of Hedge Fund Holders: 234
NVIDIA Corporation (NASDAQ:NVDA) ranks among the best high growth high margin stocks to buy now. On February 5, Goldman Sachs revised its Buy rating for NVIDIA Corporation (NASDAQ:NVDA), with a $250 price target. The firm anticipates a beat-and-raise quarter for the tech giant, citing strong industry supply/demand trends, though it admits that projections for outperformance have already become high.
Goldman Sachs believes that near-term stock price growth will be dependent on insight into 2027 revenue, as the upside potential for 2026 has already been built into the stock. The firm highlighted several possible catalysts for higher earnings in the first half of 2026, including sustained positive adjustments to hyperscaler capital expenditure through 2027 and growing trust in demand from unconventional clients like AI giants OpenAI and Anthropic.
Additionally, Goldman Sachs emphasized that NVIDIA’s tech superiority might be strengthened by the impressive performance outcomes of new large language models trained on the company’s Blackwell architecture.
NVIDIA Corporation (NASDAQ:NVDA) designs and sells specialized processors, initially for gaming but now also crucial for AI, data centers, professional visualization, and the automotive industry.
While we acknowledge the potential of NVDA to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than NVDA and that has 100x upside potential, check out our report about this cheapest AI stock.
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