The stock market has produced average annual returns of about 10% over the past few decades, which is enough to double your money every seven years. But it’s not that difficult to grow your money faster with well-chosen growth stocks.

To give you some ideas, three Motley Fool contributors believe When holding (NYSE:ONON), MercadoLibre (NASDAQ: MELI)And Dutch brothers (NYSE: BROS) can help you above-average returns. Find out why here.

Past the competition

Jennifer Saibil (on hold): On has established itself as a top premium brand and challenges names like Nike And Lululemon Athletica. It stands out for its rapid growth despite inflation, and that’s just the beginning. It has tremendous growth potential as it builds its brands and attracts loyal fans, and growth-oriented investors should take a look.

First, the numbers. On reported phenomenal results in the second quarter of 2024, starting with a 29% year-over-year increase in revenue (at constant currency). Profitability was excellent, with gross margin increasing from 59.5% to 59.9% and net profit increasing 834%.

The results were so good that Wall Street was willing to forgive the earnings miss. It had expected earnings per share (EPS) of $0.18, while On’s earnings came in at $0.17. A penny may seem insignificant, but Wall Street has smashed stocks for smaller losses.

Next, opportunity. Still weakly branded virtually everywhere, On is impressing shoppers by building its name through marketing efforts, new direct-to-consumer stores and wholesale deals. The company has its finger on the pulse of current shopping trends, and sales are growing at roughly equal rates across direct-to-consumer and wholesale channels.

Although the company is best known for its shoes, many of which feature a unique sole that has become its trademark, its premium branding is gaining a following and driving interest in its clothing and accessories. All of these categories are growing at a rapid pace, but clothing was a highlight in the second quarter, up 66% year-over-year, and that’s an opportunity On is capitalizing on. For example, the company recently launched a partnership with lifestyle and fashion icon celebrity Zendaya, as well as a branded tennis collection.

On expects full-year revenue growth of at least 30%, which likely drove the positive market reaction after the results were released, and is rolling out new efficiency models in the second half of the year. On shares are expected to continue to rise this year and in the long term.

The story continues

This stock has returned 1,600% and is still undervalued

John Ballard (MercadoLibre): Latin America is one of the fastest growing e-commerce markets in the world and MercadoLibre has capitalized on this, delivering phenomenal returns to its shareholders over the past few years.

The company generates revenue in a number of ways, which suggests growth opportunities. It operates a marketplace for buyers and sellers where it earns transaction fees. It also sells its own inventory to consumers through its own fulfillment system. However, one of its fastest-growing services is in-store transactions with its fintech offering.

The marketplace continues to show incredible growth in gross merchandise volume (GMV), with Brazil and Argentina – two of its largest markets – reporting GMV increases of 36% and 252% year-over-year, respectively, in the second quarter. This comes as the company rolls out new shipping options and investments to expand its last-mile delivery capabilities.

MercadoLibre recently opened a fulfillment center in Texas that will expand product selection for customers in Mexico. It is an example of MercadoLibre’s potential to find ways to drive strong growth for shareholders.

The best part is that despite its 1,600% return over the last 10 years, the stock has returned to its cheapest Price-to-sales (P/S) ratio for years. It currently trades at a P/S multiple of 5.6 – below its previous 10-year average of 10.

With the company’s revenue continuing to grow strongly (up 113% in the latest quarter compared to the same period last year (excluding currency fluctuations)), the stock could deliver wealth-building returns to shareholders. All the stock needs to do is continue to trade at the current price-to-earnings ratio.

A coffee stock that is just starting to gain momentum

Jeremy Bowman (Dutch Bros): One of the most puzzling price movements in recent weeks occurred after Dutch Bros announced its second-quarter results.

The fast-growing drive-thru coffee chain reported strong results, with revenue jumping 30% to $325 million on 4.1% growth in store sales. Margins also improved, and net income under generally accepted accounting principles (GAAP) doubled to $22.2 million. Both revenue and profit beat estimates.

Despite strong results and an increase in financial guidance, Dutch Bros’ share price plummeted following the update, losing 20 percent on August 8.

The reason for the sell-off seemed to be that the company said the number of new openings this year was now at the low end of its forecast range of 150 to 165. There was no specific reason for this update, nor does it indicate any long-term problems for the company. It’s likely just delays in construction or permitting or other industry vagaries.

Punishing the stock for its slightly slower growth this year seems excessive and illogical, especially given that the company raised its full-year revenue forecast to $1.215 billion from $1.2 billion.

Even after the discount, the stock is still trading at a premium. But it also shows that the company is misunderstood because, despite the setbacks in opening new stores, it has been able to accelerate its sales growth – an achievement that should be rewarded.

Dutch Bros currently has fewer than 1,000 stores and has a long growth phase ahead of it, considering that established coffee chains like Dunkin’ and Starbucks have several thousand locations in the USA

Investors should take advantage of the sell-off and secure a piece of this fast-growing restaurant chain that is running at full speed.

Don’t miss this second chance at a potentially lucrative opportunity

Have you ever felt like you missed out on the best performing stocks? Then you should listen to this.

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We are currently issuing Double Down alerts on three incredible companies, and an opportunity like this may not come again anytime soon.

Check out 3 “Double Down” Stocks »

*Stock Advisor returns as of August 12, 2024

Jennifer Saibil has positions in MercadoLibre. Jeremy Bowman has positions in MercadoLibre, Nike, and Starbucks. John Ballard has positions in Dutch Bros and MercadoLibre. The Motley Fool has positions in and recommends Lululemon Athletica, MercadoLibre, Nike, and Starbucks. The Motley Fool recommends Dutch Bros and On Holding and recommends the following options: long January 2025 $47.50 calls on Nike. The Motley Fool has a disclosure policy.

3 Hot Growth Stocks You Can Buy Now Without Hesitation was originally published by The Motley Fool