Megacap stocks dominate their sectors and their actions influence economies worldwide. The flip side though is that their sheer size means they have less room for explosive growth as scale works against them.
These trade-offs can cause headaches for even the most seasoned professionals, which is why we started StockStory - to help you find high-quality companies that can grow their earnings no matter what. That said, here are two industry titans with attractive long-term potential and one whose momentum may slow.
One Mega-Cap Stock to Sell:
Cisco (CSCO)
Market Cap: $281.1 billion
Founded in 1984 by a husband and wife team who wanted computers at Stanford to talk to computers at UC Berkeley, Cisco (NASDAQ: CSCO) designs and sells networking equipment, security solutions, and collaboration tools that help businesses connect their systems and secure their digital operations.
Why Are We Wary of CSCO?
- Products and services are facing end-market challenges during this cycle, as seen in its flat sales over the last two years
- Free cash flow margin shrank by 6.2 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive
- Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability
At $71.50 per share, Cisco trades at 17.7x forward P/E. To fully understand why you should be careful with CSCO, check out our full research report (it’s free for active Edge members).
Two Mega-Cap Stocks to Buy:
Shopify (SHOP)
Market Cap: $232.7 billion
Starting with just three people selling snowboards online in 2004, Shopify (NYSE: SHOP) provides a comprehensive platform that enables merchants of all sizes to create, manage and grow their businesses across multiple sales channels.
Why Will SHOP Outperform?
- Billings have averaged 29.5% growth over the last year, showing it’s securing new contracts that could potentially increase in value over time
- Expected revenue growth of 23.9% for the next year suggests its market share will rise
- Software platform has product-market fit given the rapid recovery of its customer acquisition costs
Shopify is trading at $177.72 per share, or 18.9x forward price-to-sales. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free for active Edge members .
AppLovin (APP)
Market Cap: $213.5 billion
Sitting at the crossroads of the mobile advertising ecosystem with over 200 free-to-play games in its portfolio, AppLovin (NASDAQ: APP) provides software solutions that help mobile app developers market, monetize, and grow their apps through AI-powered advertising and analytics tools.
Why Will APP Beat the Market?
- Market share has increased as its 35.8% annual revenue growth over the last two years was exceptional
- Well-designed software integrates seamlessly with other workflows, enabling swift payback periods on marketing expenses and customer growth at scale
- Robust free cash flow margin of 53.7% gives it many options for capital deployment
AppLovin’s stock price of $627 implies a valuation ratio of 33.7x forward price-to-sales. Is now the right time to buy? Find out in our full research report, it’s free for active Edge members.
High-Quality Stocks for All Market Conditions
When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.
Don’t let fear keep you from great opportunities and take a look at Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
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-small-cap company Exlservice (+354% 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
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.
