Grab Holdings (GRAB): A Top Penny Stock to Buy in January 2025

While investing in penny stocks, it's wise to consider analyst ratings. They can serve as a valuable guide, with stocks receiving a “Strong Buy” consensus indicating that industry experts see significant upside potential in them in the long run.

Penny stocks can be an interesting investment option, but they also come with a higher level of risk. To help you navigate this market, I've put together a list of the best penny stocks to buy in January. These stocks have been carefully selected based on their strong fundamentals, growth potential, and industry outlook.

One stock that stands out is Grab Holdings (NASDAQ:GRAB). The company operates a leading super app in Southeast Asia, offering a wide range of services including food and grocery deliveries, ride-hailing, package delivery, digital payments, lending, and insurance.

With a presence in over 480 cities across eight countries, Grab is well-positioned to capitalize on the region's rapidly growing digital economy. The company boasts a strong brand presence and a loyal user base, making it a prime candidate for continued success in the years to come.

Financially, Grab is also firing on all cylinders. In Q3 2024, the company reported a record group adjusted EBITDA of $90 million, a more than threefold increase year-over-year. This marks the eleventh consecutive quarter of adjusted EBITDA improvement, showcasing the company's ability to scale and generate strong operating profits.

Engagement on the platform continues to trend upwards. Monthly transacting users (MTUs) rose by 16% year-over-year to 42 million in Q3 2024. This metric is crucial for assessing platform engagement and growth, and Grab's performance highlights the increasing user activity and stickiness within the Grab ecosystem.

Moreover, Grab is generating positive adjusted free cash flow, aligning with its target of positive free cash flow for the full fiscal year. Over the trailing 12 months, the company achieved an adjusted free cash flow of $76 million.

Looking ahead, Grab is focused on enhancing value for its users and ecosystem partners. In 2025, the company will continue to drive market penetration and expand its reach within its total addressable market.

In Q3, the Deliveries segment showed strong growth, especially in Saver and Priority Deliveries. Similarly, in Mobility, High-Value Mobility offerings complement affordability initiatives, ensuring a comprehensive suite of services tailored to diverse user needs.

Cross-selling remains a key growth driver for Grab. By encouraging GrabFood users to explore GrabMart, the company has achieved remarkable success. GrabMart is growing at nearly double the pace of GrabFood while remaining profitable.

Interestingly, users who engage with both services have a higher transaction frequency — almost five times that of GrabFood-only users — and exhibit more than twice as high retention rates. This dynamic enhances user stickiness and strengthens relationships with ecosystem partners.

Finally, Grab's financial services offerings, which are provided through GrabFin and its digital banks, also saw solid growth. In Q3 2024, Grab's consolidated Digital Bank deposits tripled to exceed $1 billion, while total loans disbursed reached a record $567 million.

With a clear focus on technological innovation, Grab is deploying several AI models across its platform to enhance user experiences and improve operational efficiency. This integration provides new opportunities for partners and ultimately drives growth for the entire ecosystem.

Collectively, Grab's strong market position, large addressable market, and emphasis on enhancing convenience through technological innovation and ecosystem development position it for sustained long-term growth.

Its strategy of increasing high-value transactions and catering to robust domestic demand will likely propel Grab's financials and expand its user base in 2025 and beyond. Furthermore, with its improving operating leverage and goal of delivering sustainable free cash flow, Grab is poised to generate solid shareholder returns.