Growth is oxygen. But when it evaporates, the consequences can be severe - ask anyone who bought Cisco in the Dot-Com Bubble or newer investors who lived through the 2020 to 2022 COVID cycle.
The risks that can come from buying these assets is precisely why we started StockStory - to isolate the long-term winners from the losers so you can invest with confidence. On that note, here is one growth stock where the best is yet to come and two that could be down big.
Two Growth Stocks to Sell:
Kura Sushi (KRUS)
One-Year Revenue Growth: +18.8%
Known for its conveyor belt that transports dishes to diners, Kura Sushi (NASDAQ: KRUS) is a chain of sushi restaurants serving traditional Japanese fare with a touch of modernity and technology.
Why Does KRUS Worry Us?
- Weak same-store sales trends over the past two years suggest there may be few opportunities in its core markets to open new restaurants
- Cash burn has widened over the last year, making us question whether it can reliably generate shareholder value
- Unfavorable liquidity position could lead to additional equity financing that dilutes shareholders
Kura Sushi’s stock price of $80.18 implies a valuation ratio of 44.1x forward EV-to-EBITDA. If you’re considering KRUS for your portfolio, see our FREE research report to learn more.
Resideo (REZI)
One-Year Revenue Growth: +20%
Resideo Technologies, Inc. (NYSE: REZI) is a manufacturer and distributor of technology-driven products and solutions for home comfort, energy management, water management, and safety and security.
Why Are We Wary of REZI?
- Estimated sales growth of 2.4% for the next 12 months implies demand will slow from its two-year trend
- Poor free cash flow margin of 3.9% for the last five years limits its freedom to invest in growth initiatives, execute share buybacks, or pay dividends
- Waning returns on capital imply its previous profit engines are losing steam
Resideo is trading at $33.91 per share, or 12.3x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than REZI.
One Growth Stock to Buy:
BellRing Brands (BRBR)
One-Year Revenue Growth: +16.3%
Spun out of Post Holdings in 2019, Bellring Brands (NYSE: BRBR) offers protein shakes, nutrition bars, and other products under the PowerBar, Premier Protein, and Dymatize brands.
Why Should You Buy BRBR?
- Products are selling at a rapid clip as its unit sales averaged an outstanding 20.1% growth rate over the past two years
- Share repurchases over the last three years enabled its annual earnings per share growth of 27.8% to outpace its revenue gains
- ROIC punches in at 46.6%, illustrating management’s expertise in identifying profitable investments
At $40.17 per share, BellRing Brands trades at 16.5x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
Stocks We Like Even More
Donald Trump’s April 2025 "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 6 Stocks for this week. 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
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