My 3 Favorite Stocks to Buy Right Now

While technology stocks have been getting much of the investor attention, the consumer space has some attractive opportunities to invest in right now.

Let's look at three stocks to buy heading into the new year.

Image source: Getty Images.

Amazon

E-commerce giant Amazon (NASDAQ: AMZN) hasn't gotten a lot of investor love in the past few years, pushing it to one of its lowest ever valuations. However, the company has been doing a lot of good things behind the scenes that are helping improve its business.

This all starts with its robotics and artificial intelligence (AI) initiatives. The company now has over 1 million robots operating in its fulfillment centers, all of which are coordinated with its DeepFleet AI model. Meanwhile, it's also using AI to help speed up delivery and save costs by predicting the best warehouses to store items, optimizing delivery routes, and helping drivers find difficult-to-locate drop-off locations in places like large apartment complexes. AI is also driving its high gross margin ad business, which has been one of its fastest-growing businesses. This is all leading to strong operating leverage in its e-commerce operations.

Meanwhile, AWS, its cloud computing unit, is seeing strong growth. This should only start to accelerate in the coming years as the company has increased its capital expenditures (capex) budget to capture the demand it is seeing for AI services, and it has several large deals in place with Anthropic and OpenAI.

Dutch Bros

Coffee shop operator Dutch Bros (NYSE: BROS) is one of the best growth stories in the consumer space, as the company has both same-store sales drivers and a long runway of expansion in front of it. The company has already been seeing strong comparable shop sales, driven by mobile order-ahead, menu innovation, and increased marketing. However, that is just the start.

The introduction of hot food items is set to be the next big same-store sales catalyst, as it rolls out these items to the three-quarters of its shops that can support them. In tests, shops with hot food items have seen a 4% sales lift, but that is likely to increase even more as it becomes more widely available and it throws more marketing toward the initiative.

At the same time, Dutch Bros has a big expansion opportunity ahead. At the end of Q3, it had under 1,100 locations, with plans to have more than 2,000 by 2029 and supporting around 7,000 in the U.S. over the longer term.

e.l.f. Beauty

If my daughter's Christmas present haul is any indication, e.l.f Beauty (NYSE: ELF) is going to have a strong quarter led by Rhode. But in all seriousness, the Rhode acquisition looks set to be a big growth driver for the company over the next few years. Before being acquired, the skincare brand saw huge sales growth from just a small product assortment, little marketing spend, and no distribution outside its website. Once put inside the e.l.f. structure, this should change.

Rhode recently started being sold at Sephora, and after its exclusivity period ends, e.l.f. will likely begin to increase its distribution to other outlets, like Ulta Beauty. Meanwhile, the company has only offered around a dozen products, so e.l.f. also has a nice runway to expand its assortment, as well. And of course, the company can always put Rhode into its marketing engine.

Meanwhile, e.l.f. still has solid opportunities with its namesake and Naturium brands, as well. The company should continue to take shelf space in the U.S., while it is still in the early days of international expansion. A price hike following the introduction of tariffs should also help boost revenue growth.

The beaten-up stock is not expensive, trading at a forward price-to-earnings (P/E) multiple of around 22.5 times a price/earnings-to-growth (PEG) ratio below 0.4 times (with below 1 times considered undervalued), making it a strong rebound candidate in 2026.

Geoffrey Seiler has positions in Amazon, Dutch Bros, and e.l.f. Beauty. The Motley Fool has positions in and recommends Amazon, Ulta Beauty, and e.l.f. Beauty. The Motley Fool recommends Dutch Bros. The Motley Fool has a disclosure policy.