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 with room for further growth.

MercadoLibre (MELI)

Five-Year Return: +99.5%

Originally started as an online auction platform, MercadoLibre (NASDAQ: MELI) is a one-stop e-commerce marketplace and fintech platform in Latin America.

Why Are We Backing MELI?

1. Unique Active Buyers have increased by an average of 20.7% annually, giving it the potential for margin-accretive growth if it can develop valuable complementary products and features
2. Platform’s growing usage and its ability to increase user spending by 15.5% annually showcases its high switching costs
3. Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends, and its rising cash conversion increases its margin of safety

MercadoLibre is trading at $2,413 per share, or 24.8x forward EV/EBITDA. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.

Ulta (ULTA)

Five-Year Return: +112%

Offering high-end prestige brands as well as lower-priced, mass-market ones, Ulta Beauty (NASDAQ: ULTA) is an American retailer that sells makeup, skincare, haircare, and fragrance products.

Why Could ULTA Be a Winner?

1. Aggressive strategy of rolling out new stores to gobble up whitespace is prudent given its same-store sales growth
2. Robust free cash flow margin of 8.5% gives it many options for capital deployment
3. Market-beating returns on capital illustrate that management has a knack for investing in profitable ventures

Ulta’s stock price of $493.60 implies a valuation ratio of 19.8x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.

Griffon (GFF)

Five-Year Return: +243%

Initially in the defense industry, Griffon (NYSE: GFF) is a now diversified company specializing in home improvement, professional equipment, and building products.

Why Are We Positive On GFF?

1. Operating margin improvement of 8.8 percentage points over the last five years demonstrates its ability to scale efficiently
2. Incremental sales significantly boosted profitability as its annual earnings per share growth of 28.8% over the last five years outstripped its revenue performance
3. Free cash flow margin jumped by 13 percentage points over the last five years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends

At $76.16 per share, Griffon trades at 12.4x forward P/E. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.

Stocks We Like Even More

When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.

Don’t let fear keep you from great opportunities and take a look at 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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