Microsoft – A Strong Tech Player

Our Top 3 list begins with the tech giant Microsoft. The company has long since moved beyond being just a provider of operating systems and the Microsoft 365 suite—it’s now one of the leading players in AI and cloud services. AI alone generated over $13 billion in revenue for Microsoft in the past year, a 175% increase compared to 2023.[1] The company’s cloud AI service Azure, known for its hybrid cloud environment, is a key driver of its cloud business. Azure’s revenue rose by 31% in the second fiscal quarter of 2025, and according to the CFO, Amy Hood, as reported by CNBC[2], growth is expected to accelerate in the second half of the year.[1] Another important product in Microsoft's portfolio is Microsoft 365, formerly known as Office 365, now enhanced with the AI-powered Copilot chatbot. Strong demand for this product continues, as reflected in the quarterly report, which showed a 15% increase in commercial use revenue. Microsoft’s solid foundation is further underscored by its total revenue of nearly $70 billion, marking a 12% year-over-year increase.* While high AI-related spending might raise concerns about returns, it's important to note that demand for advanced AI tools is rapidly growing. According to Grand View Research, the AI market could grow at a compound annual growth rate (CAGR) of 36% by 2030, up from a market size of $279 billion in 2024.[3]

Stock Under Correction

Looking at Microsoft’s (MSFT) performance on the NASDAQ, it’s clear that the company had a strong 2024, driven largely by interest in AI and cloud technologies. However, since the beginning of 2025, the stock has experienced a correction, with its value dropping to $357 as of April 8, 2025, marking a 15% year-over-year decline. Despite this, Microsoft’s shares remain at high levels from a long-term perspective, having gained over 95% over the past five years.* While the stock is currently in the red, it may present a buying opportunity for investors, as the company’s fundamentals and demand for AI remain strong.[2]

Microsoft’s Stock Performance Over the Past 5 Years (Source: Investing.com)*

Carvana’s Record-Breaking Results

Next on the list is Carvana, the second-largest used car retailer in the United States. The company offers a convenient platform for buying and selling cars online, with features like a price comparison tool to help customers make informed decisions. In addition to standard delivery options, Carvana is known for its unique “car vending machines,” with 40 locations across the country. Thanks to excellent service and efficient management, Carvana reported strong financial results in 2024. The company achieved record revenue of $13.67 billion, with vehicle sales increasing by 33% to over 416,300 units. Even net income hit a historic high, reaching $404 million.*[4] The outlook for 2025 remains positive, with Carvana expecting continued growth in adjusted EBITDA and overall vehicle sales.[3] The company could also benefit from the tariff policies proposed by Donald Trump. The new 25% import tax on foreign-made cars could raise vehicle prices in the U.S. by up to $15,000, potentially boosting demand for used cars. Overall, the used car market is projected to grow steadily. According to Allied Market Research, the market is expected to reach a valuation of $2 trillion by 2033, up from $857 billion in 2023.[5]

Stock Recovery

Carvana’s shares (CVNA) have gone through a volatile period on the New York Stock Exchange (NYSE), but in recent months, they have once again caught the attention of investors. As of April 8, 2025, their value was $167, representing a 122% year-on-year increase, and more than a 79% increase over the past 5 years. While this level represents a drop from the 3-year peak of $285 in early February 2025, it marks a significant recovery compared to 2022, when the share price was only $5. The correction followed the historical high of $337 in 2021.* Even though the stock has slightly retreated, the trend suggests that it still has room for growth.[4]

Carvana’s Stock Performance Over the Past 5 Years (Source: Investing.com)*

Europe's Defense as an Opportunity

Finally, we move to the European continent, where Rheinmetall, a German company, could stand out due to the European Union's new defense target. The largest producer of military equipment and weapons in Europe could benefit from the EU's decision to increase defense spending across the bloc by the end of the decade. Since the EU still considers Russia a significant threat, the ReArm Europe project is set to provide a €150 billion ($166 billion) loan to member states, with the promising aspect being that 65% of the spending must go to European manufacturers' equipment. Furthermore, with the relaxation of fiscal rules for member states, the EU could receive an additional €650 billion ($717 billion) in funding.[6] Rheinmetall is already showing strong growth, with defense segment revenues increasing by 50% in 2024, and it expects continued growth of 35% to 40% [5], excluding EU incentives. By the end of the year, it had unfilled orders totaling €55 billion ($61 billion). The company continues expanding through acquisitions and new factories, into which it has already invested billions of euros. Its annual profits grew by 61% to a record €1.48 billion ($1.6 billion), with revenue growth of 36%.*[7]

Stocks at High Levels

Rheinmetall shares (RHMG) are also performing well on the Frankfurt Stock Exchange. In March 2025, when the defense stimulus package was announced, they reached an all-time high of €1,445 ($1,594). As of April 8, their price has slightly corrected to €1,320 ($1,456), having gained 118% since the beginning of the year. A year ago, Rheinmetall shares were trading 143% lower, while five years ago, they were priced at €73 ($81), a difference of as much as 1,708%.* The correction, coupled with the EU outlook, points to room for continued growth.[6]

Rheinmetall Stock Performance Over the Last 5 Years (Source: Investing.com)*

Conclusion

Our selection consists of stocks from different sectors of the market, but they share a common factor: growth potential. While Microsoft maintains its market position, Carvana offers innovative services and continues to grow, and the geopolitical direction of Europe is influencing the German company Rheinmetall. On the other hand, these opportunities also come with their risks, so proper diversification, caution, and keeping an eye on market news are crucial.

* Past performance is no guarantee of future results

[1], [2], [3], [4], [5], [6] Forward-looking statements are based on assumptions and current expectations, which may be inaccurate, or on the current economic environment, which may change. Such statements are not guarantees of future performance. They involve risks and other uncertainties that are difficult to predict. Results may differ materially from those expressed or implied by any forward-looking statements.

[1] https://www.microsoft.com/en-us/Investor/earnings/FY-2025-Q2/press-release-webcast

[2] https://www.cnbc.com/2025/01/28/microsofts-underperformance-has-investors-looking-to-cloud-for-growth.html

[3] https://www.grandviewresearch.com/industry-analysis/artificial-intelligence-ai-market

[4] https://investors.carvana.com/~/media/Files/C/Carvana-IR/documents/cvna-earning-release-q4-2024.pdf

[5] https://www.globenewswire.com/news-release/2025/03/10/3039921/0/en/Used-Cars-Market-Size-to-Reach-2-Billion-Globally-by-2033-at-8-9-CAGR-Allied-Market-Research.html

[6] https://www.theguardian.com/world/2025/mar/19/eu-loans-scheme-europe-defence-invasion-russia-ukraine

[7] https://www.cnbc.com/2025/03/12/rheinmetall-earnings-profit-jumps-sales-expected-to-boom.html