In this article, we will take a look at the stocks with the best earnings growth for the next 5 years.
After decades of market leadership concentrated narrowly, investors are increasingly shifting their focus to companies with sustainable earnings power. That said, many believe the next phase of market returns will be driven by fundamentals, rather than hype.
On January 15, Reuters published “S&P 500 leadership showing signs of broadening beyond tech,” an article asserting that investors are now pushing for a broader rally, one that is driven by industrials, healthcare, and small-cap companies. The author writes that such companies are likely to close the performance gap and lead the market, after years in which technology stocks drove the U.S. bull market.
Over time, investors have become cautious about expensive tech valuations amid uncertainty surrounding the AI narrative that fueled gains, allowing other sectors to make headway, the publication discussed. The article further cited Angelo Kourkafas, a senior global investment strategist at Edward Jones. He argued,
“There is a lot of hope that this is going to be the year where we are going to see some true broadening of leadership,” said Kourkafas. “The conditions are likely in place for that broadening to happen, especially when you sprinkle in and consider elevated valuations, there are some pockets of value that can be found looking beyond technology.”
Against this backdrop, we have compiled a list of stocks with the best earnings growth for the next 5 years. From consumer cyclical and technology to communication services and healthcare, these stocks belong to a range of sectors.
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Our methodology
For this article, we considered stocks with market capitalizations exceeding $2 billion. After this initial screening, we shortlisted stocks with both forecasted EPS growth over the next 5 years and a return on equity of over 20%. These stocks are then ranked by the number of hedge fund holdings, based on Insider Monkey’s database, 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).
12. ServiceNow, Inc. (NYSE:NOW)
Number of Hedge Fund Holders: 104
Return on Equity (TTM): 16.81%
On January 13, Brian Schwartz, an analyst at Oppenheimer, reaffirmed a ‘Buy’ rating on ServiceNow, Inc. (NYSE:NOW). With a price target of $200, the stock has an upside potential of 68%.
A day later, on January 14, Evercore ISI maintained an ‘Outperform’ rating on ServiceNow, Inc. (NYSE:NOW), keeping a price target of $225. The firm noted a stable demand pattern and growing adoption of the company’s Now Assist AI offering. Although the shares have declined in the last three months, the firm expects fourth-quarter results to showcase the company’s solid growth at scale. Since October, the stock has dipped by nearly 28%.
By 2026, the company’s AI strategy is set to exceed $1 billion in annual recurring revenue (ARR), with partner surveys pointing to steady demand and increasing interest, Evercore ISI highlighted, adding that ServiceNow, Inc. (NYSE:NOW) offers an appealing long-term risk/reward profile at its current valuation of about 22.5 times enterprise value to CY27 free cash flow.
ServiceNow, Inc. (NYSE:NOW) is a California-based provider of cloud-based solutions for digital workflows. Incorporated in 2004, the company operates the Now platform and delivers a diverse range of products, including customer service management, field service management applications, and source-to-pay operations.
11. Micron Technology, Inc. (NASDAQ:MU)
Number of Hedge Fund Holders: 105
Return on Equity (TTM): 22.55%
On January 15, Citi lifted the price target on Micron Technology, Inc. (NASDAQ:MU) to $385 from $330 and maintained a Buy rating, while removing the stock from its US Focus List. According to an analyst note, the company’s DRAM pricing momentum may decline in Q2 relative to Q1, noting that the stock usually moves in line with its quarter-over-quarter pricing momentum.
A day before, RBC Capital began coverage on Micron Technology, Inc. (NASDAQ:MU) with an ‘Outperform’ rating and $425 price target. The bank believes rising demand for generative AI, coupled with better supply discipline, has created “extreme tightness” in the memory space. This could extend the current upcycle into 2027.
Srini Pajjuri, an analyst at RBC, noted the company’s robust roadmap, stating that High Bandwidth Memory (HBM) content is accelerating at a rate higher than 50%, with the HBM4 shift reflecting a significant tailwind for the company. That said, the firm anticipates record earnings of $50 or more per share for Micron Technology, Inc. (NASDAQ:MU).
Micron Technology, Inc. (NASDAQ:MU) is an Idaho-based company specializing in memory and storage products. Incorporated in 1978, the company operates through four segments, including the Cloud Memory Business Unit and Core Data Center Business Unit.
10. GE Vernova Inc. (NYSE:GEV)
Number of Hedge Fund Holders: 108
Return on Equity (TTM): 16.72%
On January 12, Austin Wang from GLJ Research substantially increased the price target on GE Vernova Inc. (NYSE:GEV) to $1,087 from $805 and maintained a ‘Buy’ rating on the stock. Although the firm is lifting both its guidance and 12-month price target after investor day and ahead of Q4 results scheduled for January 28, it remains “increasingly cautious on the near-term picture,” due to “limited positive catalysts and negative rate of change for data center headline risk.”
Earlier on January 9, Baird reduced the price target on GE Vernova Inc. (NYSE:GEV) to $649.00 from $816.00, while downgrading the company to ‘Neutral’ from ‘Outperform.’ The research firm highlighted rising investor worries over a potential power capacity oversupply due to recent announcements from emerging peers.
Although the market appears tight, particularly in the times ahead, these announcements and oversupply concerns are shifting sentiment around a widely held long position, the firm noted, adding that it continues to move GE Vernova Inc. (NYSE:GEV) “to the sidelines near term” in this dynamic market.
GE Vernova Inc. (NYSE:GEV) is a Massachusetts-based energy company providing various products and services that generate, transmit, convert, and store electricity. Incorporated in 2023, the company operates through three segments: Power, Wind, and Electrification.
9. AppLovin Corporation (NASDAQ:APP)
Number of Hedge Fund Holders: 110
Return on Equity (TTM): 241.89%
On January 13, Morgan Stanley lifted the price target on AppLovin Corporation (NASDAQ:APP) to $800 from $750 and maintained an ‘Overweight’ rating on the stock, according to TheFly. This suggests a potential upside of nearly 31%.
According to the firm, 2026 will be “thematically similar” to 2025 in the internet sector as the market is expected to reward companies with significantly positive ROIC from GenAI or GPU-enabled technologies. Meanwhile, subsectors exposed to disruption uncertainty, including ridesharing from autonomous vehicles (AV) and e-commerce, travel, and smaller, less proven ad platforms, will likely trade at lower multiple bands, the analyst states in a note on the North America Internet group.
A day later, Robert Coolbrith from Evercore ISI started coverage on AppLovin Corporation (NASDAQ:APP) with an ‘Outperform’ rating and a price target of $835. The analyst calls the company’s ad tech platform for mobile gaming “dominant,” anticipating spending in mobile gaming and e-commerce ads to maintain 30%-plus revenue and EBITDA compound annual growth rates from 2025 to 2028.
AppLovin Corporation (NASDAQ:APP) is a California-based company building a software-based platform for advertisers to improve the marketing of their content. Founded in 2011, the company operates through two segments: Advertising and Apps.
8. Eli Lilly and Company (NYSE:LLY)
Number of Hedge Fund Holders: 114
Return on Equity (TTM): 48.29%
On January 14, BMO Capital reaffirmed an ‘Outperform’ rating on Eli Lilly and Company (NYSE:LLY) with a price target of $1,200. Matching the consensus 1-year median target price, the stock has an upside potential of 16.36%. The firm remains confident in the company’s solid leadership position in the obesity treatment space and beyond for 2026 and the years ahead.
BMO Capital pointed out that growth and certainty for the company’s incretin business is backed by broadening access, the expected launch of orforglipron, and the company’s growing portfolio. While maintaining its leadership in the obesity market, Eli Lilly and Company (NYSE:LLY) also has a solid presence in other disease areas, particularly Lp(a), which contributes to its long-term growth outlook, the firm added.
Two days earlier, Eli Lilly and Company (NYSE:LLY) announced a partnership with NVIDIA to develop an AI co-innovation lab focused on pharmaceutical research. The leading entities plan to invest up to $1 billion in talent, infrastructure, and computing resources over a period of five years.
Eli Lilly and Company (NYSE:LLY) is an Indiana-based company that discovers, develops, and markets human pharmaceuticals. Founded in 1876, the company is committed to improving people’s lives around the globe.
7. Spotify Technology S.A. (NYSE:SPOT)
Number of Hedge Fund Holders: 116
Return on Equity (TTM): 22.64%
On January 15, Spotify Technology S.A. (NYSE:SPOT) announced price hikes for premium subscriptions. Starting from billings in February, the subscription rate will rise from $11.99/month to $12.99/month.
According to CNBC, Spotify Technology S.A. (NYSE:SPOT) last raised the Premium price for U.S. users in June 2024 to $11.99 per month. As stated in the company’s announcement,
Over the next month, Premium subscribers across the U.S., Estonia, and Latvia will receive an email explaining what this update means for their subscriptions. Occasional updates to pricing across our markets reflect the value that Spotify delivers, enabling us to continue offering the best possible experience and benefit artists.
On the same day, Jefferies trimmed the price target on Spotify Technology S.A. (NYSE:SPOT) to $750 from $800 and maintained a ‘Buy’ rating. The firm keeps the company as a “Top Pick” due to projections of revenue acceleration in 2026, driven by price increases and sustained subscriber momentum. Additional upside potential stems from super-fan and other upsell initiatives. Jefferies calls the company an “undermonetized asset” with a “clean revision story,” saying that its estimates are nearly 15% ahead of consensus on 2027 free cash flow per share.
Spotify Technology S.A. (NYSE:SPOT) is a Luxembourg-Headquartered provider of audio streaming subscription services. Founded in 2006, the company operates through two segments: Premium and Ad-Supported.
6. Salesforce, Inc. (NYSE:CRM)
Number of Hedge Fund Holders: 119
Return on Equity (TTM): 12.18%
On January 15, Wolfe Research maintained an ‘Outperform’ rating on Salesforce, Inc. (NYSE:CRM) with an unchanged price target of $350, which suggests an upside potential of approximately 50%. This update follows the firm’s participation in Salesforce’s Agentforce World Tour in Boston.
The firm notes positive momentum for the company’s AI portfolio, highlighting that Agentforce is increasingly becoming more integrated throughout the company’s user interface. Instead of depending on separate chat interactions, the system now proactively offers agent-powered suggestions within current workflows, Wolfe Research added.
According to the firm’s analysis, early customer deployments of Agentforce mainly focus on internal use cases, including meeting setup, CRM data entry, and enterprise search, as well as customer service chatbots and sales development functions.
Three days earlier, on January 12, Raimo Lenschow from Barclays lifted the price target on Salesforce, Inc. (NYSE:CRM) to $338 from $330, while keeping an ‘Overweight’ rating on the stock. Slightly above the consensus 1-year median price target of $335, the target offers an upside potential of about 44%.
Salesforce, Inc. (NYSE:CRM) is a California-based provider of customer relationship management (CRM) technology. Incorporated in 1999, the company connects companies and customers together through its core offerings, including Agentforce, Data Cloud, Industries AI, and Slack.
5. Oracle Corporation (NYSE:ORCL)
Number of Hedge Fund Holders: 122
Return on Equity (TTM): 32.00%
On January 14, Reuters’ Jonathan Stempel reported that bondholders have sued Oracle Corporation (NYSE:ORCL), claiming they suffered losses due to the company’s failure to disclose that it would need to issue significant additional debt to develop its AI infrastructure.
Filed in a New York state court in Manhattan, the proposed class action lawsuit was filed on behalf of shareholders who acquired $18 billion of notes and bonds that were issued in September, the author notes, adding that this was two weeks after the company’s announcement of a five-year contract to supply Microsoft-backed (MSFT) OpenAI in a $300 billion deal.
Investors named in the suit assert that they were not informed when Oracle Corporation (NYSE:ORCL) returned to the capital markets just seven weeks later to seek $38 billion in loans to support its OpenAI collaboration.
“The bond market’s reaction to Oracle’s additional debt was swift and bracing,” the bondholders cited.
On the same day, KeyBanc Capital Markets reaffirmed an ‘Overweight’ rating and $300 on Oracle Corporation (NYSE:ORCL). Regarding the two distinct segments, the firm’s assessment suggests that “either one or both are being undervalued,” resulting in the conclusion that “Oracle’s stock overall remains attractive.”
Oracle Corporation (NYSE:ORCL) is a Texas-based company that provides solutions for enterprise information technology environments. Incorporated in 1977, the company offers Oracle Cloud SaaS, cloud-based industry solutions, Oracle Cloud license and on-premise license, and Oracle license support services.
4. Netflix, Inc. (NASDAQ:NFLX)
Number of Hedge Fund Holders: 154
Return on Equity (TTM): 28.22%
According to TheFly, Wedbush trimmed the price target on Netflix, Inc. (NASDAQ:NFLX) to $115 from $140 and maintained an ‘Outperform’ rating on January 15. The firm highlights the stock’s decline since the company reported disappointing Q3 results and Q4 guidance, with sentiment further weighed down by concerns related to the pending Warner Bros. Discovery (WBD) acquisition. This follows many quarters of strong results. That said, the stock has witnessed a dip of around 29% over the last six months.
Although execution risks still linger, Wedbush believes Netflix, Inc. (NASDAQ:NFLX) is poised for significant growth in global advertising, and that should not be ignored. Through three core strategies: improving ad interactivity, growing ad partnerships, and enhancing purchasing capabilities, the company is poised to accelerate ad revenue contribution for the upcoming years, the firm says.
On the same day, Monness, Crespi, Hardt & Co. reaffirmed a ‘Neutral’ rating on Netflix, Inc. (NASDAQ:NFLX) ahead of its fourth-quarter 2025 earnings report set for January 20. The firm projects a 17% YoY revenue growth for Q4, in line with its third-quarter results.
Netflix, Inc. (NASDAQ:NFLX) is a California-based entertainment service provider incorporated in 1997. The company’s core offerings are streaming services, including television (TV) series, documentaries, feature films, and games. With a presence across 190 countries, the company is committed to entertaining the world.
3. Broadcom Inc. (NASDAQ:AVGO)
Number of Hedge Fund Holders: 183
Return on Equity (TTM): 31.76%
On January 15, Wells Fargo upgraded its rating on Broadcom Inc. (NASDAQ:AVGO) to Overweight from Equal-weight, while lifting the price target to $430 from $410, which suggests a potential upside of around 24%.
The leading bank noted the recent pullback in Broadcom Inc. (NASDAQ:AVGO), along with strengthening confidence in potentially significant incremental catalysts through 2026, for its bullish outlook. Additionally, Wells Fargo raised its revenue/EPS estimates to $100.3 billion/$10.80 from $97.0 billion/$10.36 for CY26 and to $143.8 billion/$15.35 and from $130.5 billion/$13.90 for CY27.
These revisions imply improved guidance for the company’s AI semiconductor revenue, now projected to reach $52.6 billion, up 116% YoY, in 2026 and $93.4 billion, climbing 78% YoY, in 2027.
Wells Fargo now forecasts low double-digit YoY growth for the company’s Infrastructure Software segment in FY26, highlighting that Broadcom Inc. (NASDAQ:AVGO) said goodbye to FY25 with nearly $73 billion in Infrastructure Software backlog.
On the same day, Citi reaffirmed a ‘Buy’ rating on Broadcom Inc. (NASDAQ:AVGO) with a price target of $480 following a transfer of coverage. The firm backs its stance with the company’s growing AI sales.
Broadcom Inc. (NASDAQ:AVGO), founded in 1961, provides semiconductor devices and infrastructure software worldwide through its Semiconductor Solutions and Infrastructure Software segments.
2. NVIDIA Corporation (NASDAQ:NVDA)
Number of Hedge Fund Holders: 234
Return on Equity (TTM): 63.17%
On January 15, Wolfe Research maintained an ‘Outperform’ rating on NVIDIA Corporation (NASDAQ:NVDA) with a price target of $250. In line with the consensus 1-year median price target, the price target reflects an upside potential of 33.60%. This follows the 25% tariff announcement by White House on some advanced semiconductors, which is likely to impact NVIDIA’s H200 shipments to China, the firm says.
Wolfe Research highlights that this tariff imposition will allow the U.S. government to collect a predetermined payment in return for allowing NVIDIA Corporation (NASDAQ:NVDA) to export H200 chips to China. The firm suggests that a complete resolution will possibly be included in broader trade negotiations between the two countries.
According to Investing.com, NVIDIA Corporation (NASDAQ:NVDA) had earlier indicated that China shipments could represent $2 billion to $5 billion per quarter, nearly 5% of the company’s current quarterly revenue, only if they are granted approval for such exports.
NVIDIA Corporation (NASDAQ:NVDA) is a California-based computing infrastructure company that offers graphics, compute, and networking solutions. Incorporated in 1993, the company is committed to enhancing computing to address the toughest challenges.
1. Amazon.com, Inc. (NASDAQ:AMZN)
Number of Hedge Fund Holders: 332
Return on Equity (TTM): 11.06%
On January 15, Raymond James cut the price target on Amazon.com, Inc. (NASDAQ:AMZN) to $260 from $275 and kept an ‘Outperform’ rating. As the analyst noted in a research note, the outlook for Q4 looks bright, given a solid holiday trend, strong ad checks, and an AWS beat, despite AI being the key driver of stock performance in the upcoming year.
Raymond James remains confident about the AWS cloud division, highlighting “untapped potential in modern robotics” and anticipating higher estimates for AWS performance than forecasted. The firm believes Wall Street guidance for AWS growth looks conservative, with bottom-up modeling suggesting a 22% to 23% growth in 2026 relative to the current consensus of 20% to 21%.
Additionally, Raymond James raised concerns about “Agentic Commerce risks,” which it says could position Amazon.com, Inc. (NASDAQ:AMZN) as a “tweener” in the firm’s AI Stack framework because of strengthened non-Amazon e-commerce ecosystems. Other than that, the firm sees potential in Trainium/Neuron, Nova/Kira, Alexa+/Rufus, Zoox/Prime Air Drones, and robotics initiatives.
Amazon.com, Inc. (NASDAQ:AMZN) is a Washington-based company that offers consumer products, advertising, and subscription services through both online and physical stores. Founded in 1994, the company is committed to becoming the world’s most customer-focused company.
While we acknowledge the potential of AMZN 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 AMZN and that has 100x upside potential, check out our report about this cheapest AI stock.
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