Whether it be online shopping or social media, secular forces are propelling consumer internet businesses forward. But it’s not all sunshine and rainbows as consumer purchasing power can make or break demand. This unpredictability is weighing on the industry as its 7.4% return over the past six months has fallen short of the S&P 500’s 14.4% gain.
Only some companies are subject to these dynamics, however, and a handful of high-quality businesses can deliver earnings growth in any environment. Keeping that in mind, here are three internet stocks we think can generate sustainable market-beating returns.
Netflix (NFLX)
Market Cap: $435 billion
Launched by Reed Hastings as a DVD mail rental company until its famous pivot to streaming in 2007, Netflix (NASDAQ: NFLX) is a pioneering streaming content platform.
Why Does NFLX Stand Out?
- Global Streaming Paid Memberships have grown by 14.2% annually, allowing for more profitable cross-selling opportunities if it can build complementary products and features
- Share buybacks catapulted its annual earnings per share growth to 29%, which outperformed its revenue gains over the last three years
- Free cash flow margin increased by 18.4 percentage points over the last few years, giving the company more capital to invest or return to shareholders
Netflix is trading at $94.99 per share, or 2.5x forward EV/EBITDA. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free for active Edge members.
DoorDash (DASH)
Market Cap: $98.05 billion
Founded by Stanford students with the intent to build “the local, on-demand FedEx", DoorDash (NYSE: DASH) operates an on-demand food delivery platform.
Why Are We Backing DASH?
- Orders are rising, meaning the company can increase revenue without incurring additional customer acquisition costs if it can cross-sell additional products and features
- Performance over the past three years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 1,009% outpaced its revenue gains
- Free cash flow margin grew by 12.6 percentage points over the last few years, giving the company more chips to play with
At $227.30 per share, DoorDash trades at 28.7x forward EV/EBITDA. Is now the right time to buy? Find out in our full research report, it’s free for active Edge members.
Remitly (RELY)
Market Cap: $3.06 billion
With Amazon founder Jeff Bezos as an early investor, Remitly (NASDAQ: RELY) is an online platform that enables consumers to safely and quickly send money globally.
Why Is RELY a Top Pick?
- Active Customers have increased by an average of 31.9% annually, giving it the potential for margin-accretive growth if it can develop valuable complementary products and features
- Additional sales over the last three years increased its profitability as the 74.6% annual growth in its earnings per share outpaced its revenue
- Free cash flow margin jumped by 24.7 percentage points over the last few years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
Remitly’s stock price of $14.74 implies a valuation ratio of 11.8x forward EV/EBITDA. Is now the time to initiate a position? See for yourself in our full research report, it’s free for active Edge members.
Stocks We Like Even More
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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