Growth is a hallmark of all great companies, but the laws of gravity eventually take hold. Those who rode the COVID boom and ensuing tech selloff in 2022 will surely remember that the market’s punishment can be swift and severe when trajectories fall.
Luckily for you, our job at StockStory is to help you avoid short-term fads by pointing you toward high-quality businesses that can generate sustainable long-term growth. That said, here are two growth stocks where the best is yet to come and one whose momentum may slow.
One Growth Stock to Sell:
Somnigroup (SGI)
One-Year Revenue Growth: +51.6%
Established through the merger of Tempur-Pedic and Sealy in 2012, Somnigroup (NYSE: SGI) is a bedding manufacturer known for its innovative memory foam mattresses and sleep products
Why Should You Dump SGI?
- Lackluster 15.3% annual revenue growth over the last five years indicates the company is losing ground to competitors
- Free cash flow margin is not anticipated to grow over the next year
- Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned
Somnigroup is trading at $73.77 per share, or 22.9x forward P/E. To fully understand why you should be careful with SGI, check out our full research report (it’s free).
Two Growth Stocks to Buy:
Mastercard (MA)
One-Year Revenue Growth: +16.4%
Recognizable by its iconic "Priceless" advertising campaign that has run in over 120 countries, Mastercard (NYSE: MA) operates a global payments network that connects consumers, financial institutions, merchants, and businesses, enabling electronic transactions and providing payment solutions.
Why Will MA Beat the Market?
- Impressive 16.5% annual revenue growth over the last five years indicates it’s winning market share this cycle
- Share buybacks propelled its annual earnings per share growth to 21.5%, which outperformed its revenue gains over the last five years
- Stellar return on equity showcases management’s ability to surface highly profitable business ventures
Mastercard’s stock price of $492.00 implies a valuation ratio of 24.9x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Ryan Specialty (RYAN)
One-Year Revenue Growth: +21.3%
Founded in 2010 by insurance industry veteran Patrick Ryan, Ryan Specialty (NYSE: RYAN) is a wholesale insurance broker and underwriting manager that helps retail brokers place complex or hard-to-place risks with insurance carriers.
Why Do We Love RYAN?
- Annual revenue growth of 21.2% over the last two years was superb and indicates its market share increased during this cycle
- Earnings per share grew by 15.6% annually over the last four years and trumped its peers
- Robust free cash flow margin of 19.2% gives it many options for capital deployment
At $34.75 per share, Ryan Specialty trades at 15.3x forward P/E. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don't just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
But our AI platform says the party isn't over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE.
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.
