"You get what you pay for" often applies to expensive stocks with best-in-class business models and execution. While their quality can sometimes justify the premium, they typically experience elevated volatility during market downturns when expectations change.
Separating true intrinsic value from speculation isn’t easy, especially during bull markets. That’s where StockStory comes in - to help you find high-quality companies that will stand the test of time. Keeping that in mind, here are three high-flying stocks expanding their competitive advantages.
AppLovin (APP)
Forward P/S Ratio: 25.2x
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 Are We Bullish on APP?
- Software platform has product-market fit given the rapid recovery of its customer acquisition costs
- Excellent operating margin of 52% highlights the efficiency of its business model, and its operating leverage amplified its profits over the last year
- Strong free cash flow margin of 53.7% enables it to reinvest or return capital consistently
At $460.25 per share, AppLovin trades at 25.2x forward price-to-sales. Is now the time to initiate a position? Find out in our full research report, it’s free.
Shake Shack (SHAK)
Forward P/E Ratio: 69.1x
Started as a hot dog cart in New York City's Madison Square Park, Shake Shack (NYSE: SHAK) is a fast-food restaurant known for its burgers and milkshakes.
Why Should SHAK Be on Your Watchlist?
- Aggressive strategy of rolling out new restaurants to gobble up whitespace is prudent given its same-store sales growth
- Same-store sales growth over the past two years shows it’s successfully drawing diners into its restaurants
- Free cash flow margin expanded by 2.1 percentage points over the last year, providing additional flexibility for investments and share buybacks/dividends
Shake Shack is trading at $105.23 per share, or 69.1x forward P/E. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.
AeroVironment (AVAV)
Forward P/E Ratio: 64x
Focused on the future of autonomous military combat, AeroVironment (NASDAQ: AVAV) specializes in advanced unmanned aircraft systems and electric vehicle charging solutions.
Why Is AVAV Interesting?
- Impressive 23.2% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Projected revenue growth of 143% for the next 12 months is above its two-year trend, pointing to accelerating demand
- Earnings per share grew by 61.5% annually over the last two years and trumped its peers
AeroVironment’s stock price of $248 implies a valuation ratio of 64x forward P/E. Is now the right time to buy? 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 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 Comfort Systems (+782% 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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