Growth is oxygen. But when it evaporates, the consequences can be extreme - ask anyone who bought Cisco in the Dot-Com Bubble (Nvidia?) or newer investors who lived through the 2020 to 2022 COVID cycle.
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. Keeping that in mind, here are two growth stocks where the best is yet to come and one whose momentum may slow.
One Growth Stock to Sell:
FormFactor (FORM)
One-Year Revenue Growth: +15.3%
With customers across the foundry and fabless markets, FormFactor (NASDAQ: FORM) is a US-based provider of test and measurement technologies for semiconductors.
Why Are We Out on FORM?
- Muted 4.4% annual revenue growth over the last five years shows its demand lagged behind its semiconductor peers
- Projected sales growth of 2.4% for the next 12 months suggests sluggish demand
- Efficiency has decreased over the last five years as its operating margin fell by 6.1 percentage points
At $32.31 per share, FormFactor trades at 20.8x forward P/E. Dive into our free research report to see why there are better opportunities than FORM.
Two Growth Stocks to Buy:
Vertiv (VRT)
One-Year Revenue Growth: +20.4%
Formerly part of Emerson Electric, Vertiv (NYSE: VRT) manufactures and services infrastructure technology products for data centers and communication networks.
Why Is VRT a Top Pick?
- Core business is healthy and doesn’t need acquisitions to boost sales as its organic revenue growth averaged 18.5% over the past two years
- Free cash flow margin jumped by 6.5 percentage points over the last five years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
- Rising returns on capital show management is finding more attractive investment opportunities
Vertiv is trading at $104.26 per share, or 27.9x forward P/E. Is now the time to initiate a position? See for yourself in our full research report, it’s free.
Eli Lilly (LLY)
One-Year Revenue Growth: +36.4%
Founded in 1876 by a Civil War veteran and pharmacist who was frustrated with the poor quality of medicines available at the time, Eli Lilly (NYSE: LLY) discovers, develops, and manufactures pharmaceutical products for conditions including diabetes, obesity, cancer, immunological disorders, and neurological diseases.
Why Are We Bullish on LLY?
- Market share has increased this cycle as its 33% annual revenue growth over the last two years was exceptional
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 17.6% exceeded its revenue gains over the last five years
- Industry-leading 25.8% return on capital demonstrates management’s skill in finding high-return investments
Eli Lilly’s stock price of $716.51 implies a valuation ratio of 28.1x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.
While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 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.
