Stocks that outperform the market usually share key traits such as rising sales, expanding margins, and increasing returns on capital. The select few that can do all three for many years are often the ones that make you life-changing money.
It’s clear there’s a strong connection between sustained earnings growth and hall-of-fame returns. Taking that into account, here are three market-beating stocks that deserve a spot on your list.
United Rentals (URI)
Five-Year Return: +349%
Owning the largest rental fleet in the world, United Rentals (NYSE: URI) provides equipment rental and related services to construction, industrial, and infrastructure industries.
Why Do We Like URI?
- Market share has increased this cycle as its 12.1% annual revenue growth over the last two years was exceptional
- Disciplined cost controls and effective management resulted in a strong long-term operating margin of 25.6%, and its rise over the last five years was fueled by some leverage on its fixed costs
- Share repurchases over the last five years enabled its annual earnings per share growth of 16.9% to outpace its revenue gains
United Rentals’s stock price of $698.67 implies a valuation ratio of 15.6x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
Dycom (DY)
Five-Year Return: +497%
Working alongside some of the most popular mobile carriers in the world, Dycom (NYSE: DY) builds and maintains telecommunications infrastructure.
Why Are We Fans of DY?
- Offerings and unique value proposition resonate with customers, as seen in its above-market 10.1% annual sales growth over the last two years
- Projected revenue growth of 13.8% for the next 12 months is above its two-year trend, pointing to accelerating demand
- Share repurchases over the last five years enabled its annual earnings per share growth of 27.2% to outpace its revenue gains
Dycom is trading at $232.83 per share, or 24.5x forward P/E. Is now a good time to buy? See for yourself in our full research report, it’s free.
BrightSpring Health Services (BTSG)
Return Since IPO: +94.8%
Founded in 1974, BrightSpring Health Services (NASDAQ: BTSG) offers home health care, hospice, neuro-rehabilitation, and pharmacy services.
Why Does BTSG Catch Our Eye?
- Market share has increased this cycle as its 20.9% annual revenue growth over the last two years was exceptional
- Sales outlook for the upcoming 12 months implies the business will stay on its desirable two-year growth trajectory
- Earnings per share have grown by 6.9% annually over the last three years, slightly higher than the industry average
At $21.43 per share, BrightSpring Health Services trades at 35x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.
While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio by checking out our 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-micro-cap company Kadant (+351% 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
