My 3 Favorite Growth Stocks to Buy in May

The stock market has warmed along with the temperature this year, racing back to hit all-time highs. However, that doesn't mean there aren't still attractively valued growth stocks out there. This is especially true in the consumer space, where investors have been a bit worried about the state of the consumer, given higher gasoline prices and the impact of tariffs.

Still, consumers tend to be resilient over the long term, and high gasoline prices should be temporary and turn lower once the war in Iran is over. Against that backdrop, let's look at three great growth stocks to buy in May.

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Dutch Bros

While it may not look like it at first glance, Dutch Bros (NYSE: BROS) may be one of the best bargain growth stocks in the market today. Why? Because the stock trades at the same forward price-to-sales (P/S) multiple (3.3 times) as rival Starbucks (NASDAQ: SBUX) based on 2026 analyst estimates, despite having a much longer growth runway.

The two companies also have similar average unit volumes at present, while Dutch Bros stores have better restaurant-level contribution margins of around 30% versus around 16% last quarter (based on rough calculations) for Starbucks in North America. This means that each individual Dutch Bros shop is actually much more profitable than a Starbucks' North America location, and as Dutch Bros expands and spreads corporate costs over a much larger store base, the company is going to be strongly profitable in the future.

With Dutch Bros hitting on all cylinders with its same-store sales and its huge expansion opportunity, this stock is a buy.

E.l.f. Beauty

Another bargain growth stock in the consumer space is e.l.f. Beauty (NYSE: ELF). One of the biggest growth drivers in the consumer space for brands is increasing product distribution, which is simply getting your products into more retail locations and in front of more consumers. E.l.f. did a great job of gaining market, increasing distribution, and taking shelf space with its namesake brand in the mass-market cosmetics space.

Now, the company is looking to take that formula and apply it to Rhode, its recently acquired premium skincare brand. Founded by celebrity Hailey Bieber, Rhode quickly grew its sales to $200 million in less than three years selling only about 10 products through its website. E.l.f. will now have the opportunity to increase Rhode's distribution in the coming years to really grow the already hot brand. It is already in LVMH's Sephora stores, and e.l.f. will undoubtedly move it into other retail outlets in the coming years. E.l.f. will also get the added benefit of being able to expand Rhode's small product assortment, which should result in strong growth in the coming years.

With the stock trading at a forward P/E of 15.5 times the 2027 consensus (ending March 2027), this is a cheap growth stock to buy.

MercadoLibre

Another beaten-up growth stock to buy while it is on sale is MercadoLibre (NASDAQ: MELI), which is the leading e-commerce and fintech platform in Latin America. The stock trades at a forward P/E of just 24.5 times 2027 estimates, while recently growing its revenue by 49% in Q1.

The company is currently in investment mode, looking to capture more share in the fragmented Latin American e-commerce market. It's done this by building out its logistics network, lowering the price threshold on free shipping, and reducing take-rates for third-party merchants selling goods at reasonable prices. While the market hasn't liked this approach, it is similar to what Amazon has done to become so successful in the U.S.

At the same time, MercadoLibre is building one of the largest fintech businesses in Latin America. The company is essentially looking to become the main financial institution for the unbanked population in South America. This is another huge market, and the company has no plans of slowing, trying to capture these two huge long-term opportunities.

If you're a long-term investor, this is a great stock to buy while it is on sale.

Geoffrey Seiler has positions in Amazon, Dutch Bros, LVMH Moët Hennessy-Louis Vuitton, MercadoLibre, and e.l.f. Beauty. The Motley Fool has positions in and recommends Amazon, Dutch Bros, MercadoLibre, Starbucks, and e.l.f. Beauty. The Motley Fool recommends Lvmh Moët Hennessy-Louis Vuitton, Société Européenne. The Motley Fool has a disclosure policy.