We’re into the first full week of trading for 2025, with the S&P 500 up nearly 1% year-to-date. Last year, this early in the year, the index was in the red, a sign that we could see a third consecutive year in positive territory.
That’s great news for investors.
Barchart’s Top 100 and Bottom 100 Stocks are where I search for inspiration on Tuesdays. Yesterday, of the top 100, 31 stocks made money in their latest fiscal year. As for the bottom 100, 10 did.
While it would be great to find some value plays hidden in the bottom 100, only nine made any money in the past year, providing little opportunity for a margin of safety. However, of the 31, plenty should continue to make money for years to come, including Nvidia (NVDA), which I won’t pick because that’s too obvious a selection.
Here are five names worth owning for the long haul.
Palantir Technologies (PLTR)
As I write this Tuesday morning, Palantir Technologies (PLTR) stock is down over 7% on news that Cathie Wood’s Ark Investment Management sold $15 million of its stock (196,728 shares). However, as of Sept. 30, the portfolio manager’s firm held 11 million shares of the data analytics software company, so the sale represents just 1.8% of the firm’s holdings.
Up 324% in the past 12 months, it’s hard to blame Wood for taking some profits.
I’m a big believer in Alex Karp and the business he is building. He’s laid the foundation for future growth, and even if he were to retire tomorrow, the company would be on a path to tremendous profits and cash flow.
At the time, I said I had no doubts that its stock could be worth $100 by late 2026. It reached $84.80 in December before falling back on widespread profit-taking.
Where it heads in 2025 is anybody’s guess.
However, Morgan Stanley analyst Sanjit Singh believes its shares could fall by 20% over the next year to $60. Meanwhile, of the 12 analysts that cover it, only three rate it as a Buy, with a $41.50 target price, significantly below where it’s currently trading.
While the road could be bumpy in 2025, it’s hard not to like the profit machine Karp is building. At the end of 2020, Palantir had an EBIT loss of $1.17 billion. As of Sept. 30, its trailing 12-month EBIT profit was $365.2 million. S&P Global Market Intelligence estimates they will hit $1.06 billion in 2024, a 200% turnaround over four years.
No risk, no reward.
Brinker International (EAT)
You won't get wealthy from owning Brinker International (EAT). However, the restaurant operator appears to be getting its act together, translating into reasonable risk-adjusted returns over the next few years—barring a major recession.
As the weighted alpha shows from above, EAT's momentum in recent weeks has heated up, suggesting more gains are on the way early in 2025. Up 63% in the past three months and 239% over the past year, EAT hit an all-time high of $142.47 on Jan. 6.
What’s driving the share price higher?
Brinker’s Chili’s comparable restaurant sales in Q1 2025 were 14.1%. The last time they were this high in the first quarter was 2022. Further, while price increases accounted for approximately half the gains in the quarter, traffic was up 6.5% over Q1 2024, so people were buying what it was selling.
Due to operational efficiencies introduced in 2024, Brinker raised its 2025 guidance for sales and earnings per share to $4.725 billion and $5.35, respectively. Given the sales growth expected in 2025, its share price trades at a reasonable 25.5x its earnings.
LandBridge Company (LB)
LandBridge Company (LB) has made significant gains early in 2025, up nearly 15% year-to-date. It went public in June 2024 at $17, bringing its gains since its IPO to 331%.
I’m unfamiliar with the company. However, unless I’m missing something, it seems like a smaller version of Texas Pacific Land Corp. (TPL), which I recommended in October 2023.
“It’s a big-picture, patient type of investment. It’s not for everyone,” I wrote in 2023.
“However, it’s got $609.3 million in cash and cash equivalents on its balance sheet, with zero debt, while generating $193 million in free cash flow in the first six months of 2023, 103% of its net income.”
Its shares have doubled in the 14 months since. That’s despite falling 29% since hitting a 52-week and all-time high of $1,749.44 in late November.
I’m getting off-topic.
Since LandBridge's founding in 2021, it has acquired 273,000 acres in the heart of Texas’ Permian Basin. Unlike Texas Pacific, which has held much of its land for decades, LandBridge continues to add to its surface acres through acquisitions.
Most recently, it acquired 46,000 acres in the Delaware Basin. It paid $245 million for the acreage and financed the purchase with equity (equity) and debt (18%). The acquisition will generate a minimum of $25 million in annual royalty revenue over the next five years.
