The best-performing stocks typically have robust sales growth, increasing margins, and rising returns on capital, and those that can maintain this trifecta year in and year out often become the legends of the investing world.
It’s clear there’s a strong connection between sustained earnings growth and hall-of-fame returns. On that note, here are three market-beating stocks that could turbocharge your returns.
Microsoft (MSFT)
Five-Year Return: +148%
Short for microcomputer software, Microsoft (NASDAQ: MSFT) is the largest software vendor in the world with its Windows operating system, Office suite, and cloud computing services.
Why Are We Bullish on MSFT?
- Microsoft is one of the great brands not just in tech but all of business. It produces mission-critical software and bundles it together, resulting in cream-of-the-crop gross margins.
- The company's elite unit economics lead to robust profit margins that improve over time. This speaks to the scale advantages and operating efficiency across its diverse portfolio, which spans everything from Office and Azure to Minecraft.
- Microsoft has a virtuous cycle of returns. Its dominant market position enables it to generate strong free cash flow, and it reinvests these funds into promising ventures that further strengthen its competitive moat.
Microsoft is trading at $537.57 per share, or 35.8x forward price-to-earnings. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.
AppLovin (APP)
Return Since IPO: +496%
Co-founded by Adam Foroughi, who was frustrated with not being able to find a good solution to market his own dating app, AppLovin (NASDAQ: APP) is both a mobile game studio and provider of marketing and monetization tools for mobile app developers.
Why Does APP Catch Our Eye?
- User-friendly software enables clients to ramp up spending quickly, leading to the speedy recovery of customer acquisition costs
- Disciplined cost controls and effective management resulted in a strong trailing 12-month operating margin of 42.8%, and it turbocharged its profits by achieving some fixed cost leverage
- Robust free cash flow margin of 49.3% gives it many options for capital deployment
AppLovin’s stock price of $388.50 implies a valuation ratio of 24x forward price-to-sales. Is now the right time to buy? Find out in our full research report, it’s free.
Commvault Systems (CVLT)
Five-Year Return: +333%
Originally formed in 1988 as part of Bell Labs, Commvault (NASDAQ: CVLT) provides enterprise software used for data backup and recovery, cloud and infrastructure management, retention, and compliance.
Why Are We Positive On CVLT?
- Billings have averaged 26.5% growth over the last year, showing it’s securing new contracts that could potentially increase in value over time
- Prominent and differentiated software culminates in a top-tier gross margin of 82%
- Healthy operating margin of 7.6% shows it’s a well-run company with efficient processes
At $191 per share, Commvault Systems trades at 7.2x forward price-to-sales. Is now the time to initiate a position? See for yourself in our full research report, it’s free.
Stocks We Like Even More
Donald Trump’s April 2024 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.
The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check 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-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
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