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3 Mid-Cap Stocks That Concern Us

CHD Cover Image

Mid-cap stocks often strike the right balance between having proven business models and market opportunities that can support $100 billion corporations. However, they face intense competition from scaled industry giants and can be disrupted by new innovative players vying for a slice of the pie.

These dynamics can rattle even the most seasoned professionals, which is why we started StockStory - to help you separate the good companies from the bad. That said, here are three mid-cap stocks to swipe left on and some alternatives you should look into instead.

Church & Dwight (CHD)

Market Cap: $20.15 billion

Best known for its Arm & Hammer baking soda, Church & Dwight (NYSE: CHD) is a household and personal care products company with a vast portfolio that spans laundry detergent to toothbrushes to hair removal creams.

Why Does CHD Give Us Pause?

  1. Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
  2. Anticipated sales growth of 4.1% for the next year implies demand will be shaky
  3. Earnings growth over the last three years fell short of the peer group average as its EPS only increased by 4.7% annually

At $83.94 per share, Church & Dwight trades at 22.7x forward P/E. To fully understand why you should be careful with CHD, check out our full research report (it’s free for active Edge members).

Royalty Pharma (RPRX)

Market Cap: $16.92 billion

Pioneering a unique business model in the pharmaceutical industry since 1996, Royalty Pharma (NASDAQ: RPRX) acquires rights to receive portions of sales from successful biopharmaceutical products, providing funding to drug developers without conducting research itself.

Why Do We Think Twice About RPRX?

  1. Sales were flat over the last two years, indicating it’s failed to expand this cycle
  2. Revenue base of $2.35 billion puts it at a disadvantage compared to larger competitors exhibiting economies of scale
  3. Costs have risen faster than its revenue over the last five years, causing its adjusted operating margin to decline by 4.4 percentage points

Royalty Pharma is trading at $39.64 per share, or 7.9x forward P/E. Check out our free in-depth research report to learn more about why RPRX doesn’t pass our bar.

First Horizon (FHN)

Market Cap: $11.19 billion

Tracing its roots back to 1864 during the Civil War era, First Horizon (NYSE: FHN) is a Tennessee-based bank holding company that provides commercial and consumer banking, wealth management, and specialty financial services across multiple states.

Why Is FHN Not Exciting?

  1. Sales tumbled by 4.2% annually over the last two years, showing market trends are working against its favor during this cycle
  2. Estimated net interest income growth of 1.8% for the next 12 months implies demand will slow from its five-year trend
  3. Earnings growth underperformed the sector average over the last two years as its EPS grew by just 5.7% annually

First Horizon’s stock price of $22.70 implies a valuation ratio of 1.3x forward P/B. Read our free research report to see why you should think twice about including FHN in your portfolio.

High-Quality Stocks for All Market Conditions

The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).

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-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.

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