2025 Investment Outlook: Top 18 Stocks and ETFs for Global Growth
Experts Predict Stronger Returns for International Markets—Here’s What to Buy
As 2025 unfolds, top investment firms, including BlackRock, J.P. Morgan, Vanguard, and Morningstar Investment Management, forecast that international stocks will outperform U.S. stocks in the coming years. In fact, some analysts even predict that bonds will generate better returns than U.S. equities.
For investors looking to diversify their portfolios beyond the U.S., Morningstar has identified 10 undervalued international stocks and 8 top-performing ETFs that offer promising growth potential.
10 Best Undervalued International Stocks
Morningstar’s Global Markets ex-US Moat Focus Index highlights companies with strong competitive advantages (“moats”) that are currently trading below their fair value estimates.
• Tencent Holdings (TCEHY) – China’s tech giant with significant digital services and gaming revenue.
• Rogers Communications (RCI) – Leading Canadian telecom provider with stable growth prospects.
• Anheuser-Busch InBev (BUD) – A global beer powerhouse with strong brand dominance.
• Yum China (YUMC) – Fast-food leader in China, operating KFC and Pizza Hut franchises.
• Bayerische Motoren Werke (BMWKY) – German luxury car manufacturer known for innovation.
• GSK (GSK) – Pharmaceutical giant with a strong pipeline in vaccines and specialty medicines.
• Taiwan Semiconductor Manufacturing (TSM) – A global leader in semiconductor production.
• Rentokil Initial (RTO) – UK-based pest control and hygiene services provider.
• Smith & Nephew (SNN) – Medical technology firm specializing in orthopedics and wound care.
• Telus (TU) – Canadian telecommunications company with a focus on 5G expansion.
8 Top International ETFs for 2025
For those who prefer broad-based exposure rather than picking individual stocks, these Gold-rated ETFs offer well-diversified international investments:
• Dimensional International Small Cap Value ETF (DISV)
• Dimensional International Small Cap ETF (DFIS)
• iShares Core MSCI Total International Stock ETF (IXUS)
• iShares MSCI EAFE Growth ETF (EFG)
• Vanguard FTSE All-World ex-US ETF (VEU)
• Vanguard FTSE All-World ex-US Small Cap ETF (VSS)
• Vanguard International Dividend Appreciation ETF (VIGI)
• Vanguard Total International Stock ETF (VXUS)
Why International Markets?
Experts highlight that global markets—particularly in Europe, Asia, and emerging economies—offer attractive valuations and stronger growth potential compared to U.S. stocks. Morningstar’s strategy focuses on identifying companies with strong economic moats and purchasing them at a discount, making them ideal for long-term investors.
As always, investors should assess their risk tolerance and portfolio needs before making investment decisions. However, with expert forecasts pointing toward global opportunities in 2025, now might be the perfect time to look beyond U.S. borders.
Experts Predict Stronger Returns for International Markets—Here’s What to Buy
As 2025 unfolds, top investment firms, including BlackRock, J.P. Morgan, Vanguard, and Morningstar Investment Management, forecast that international stocks will outperform U.S. stocks in the coming years. In fact, some analysts even predict that bonds will generate better returns than U.S. equities.
For investors looking to diversify their portfolios beyond the U.S., Morningstar has identified 10 undervalued international stocks and 8 top-performing ETFs that offer promising growth potential.
10 Best Undervalued International Stocks
Morningstar’s Global Markets ex-US Moat Focus Index highlights companies with strong competitive advantages (“moats”) that are currently trading below their fair value estimates.
• Tencent Holdings (TCEHY) – China’s tech giant with significant digital services and gaming revenue.
• Rogers Communications (RCI) – Leading Canadian telecom provider with stable growth prospects.
• Anheuser-Busch InBev (BUD) – A global beer powerhouse with strong brand dominance.
• Yum China (YUMC) – Fast-food leader in China, operating KFC and Pizza Hut franchises.
• Bayerische Motoren Werke (BMWKY) – German luxury car manufacturer known for innovation.
• GSK (GSK) – Pharmaceutical giant with a strong pipeline in vaccines and specialty medicines.
• Taiwan Semiconductor Manufacturing (TSM) – A global leader in semiconductor production.
• Rentokil Initial (RTO) – UK-based pest control and hygiene services provider.
• Smith & Nephew (SNN) – Medical technology firm specializing in orthopedics and wound care.
• Telus (TU) – Canadian telecommunications company with a focus on 5G expansion.
8 Top International ETFs for 2025
For those who prefer broad-based exposure rather than picking individual stocks, these Gold-rated ETFs offer well-diversified international investments:
• Dimensional International Small Cap Value ETF (DISV)
• Dimensional International Small Cap ETF (DFIS)
• iShares Core MSCI Total International Stock ETF (IXUS)
• iShares MSCI EAFE Growth ETF (EFG)
• Vanguard FTSE All-World ex-US ETF (VEU)
• Vanguard FTSE All-World ex-US Small Cap ETF (VSS)
• Vanguard International Dividend Appreciation ETF (VIGI)
• Vanguard Total International Stock ETF (VXUS)
Why International Markets?
Experts highlight that global markets—particularly in Europe, Asia, and emerging economies—offer attractive valuations and stronger growth potential compared to U.S. stocks. Morningstar’s strategy focuses on identifying companies with strong economic moats and purchasing them at a discount, making them ideal for long-term investors.
As always, investors should assess their risk tolerance and portfolio needs before making investment decisions. However, with expert forecasts pointing toward global opportunities in 2025, now might be the perfect time to look beyond U.S. borders.