Growth boosts valuation multiples, but it doesn’t always last forever. Companies that cannot maintain it are often penalized with large declines in market value, a lesson ingrained in investors who lost money in tech stocks during 2022.

Deciphering which businesses can sustain their high growth rates is a challenge for even the most seasoned professionals, which is why we started StockStory. Keeping that in mind, here is one growth stock where the best is yet to come and two that could be down big.

Two Growth Stocks to Sell:

Tandem Diabetes (TNDM)

One-Year Revenue Growth: +25.8%

With technology that automatically adjusts insulin delivery based on continuous glucose monitoring data, Tandem Diabetes Care (NASDAQ: TNDM) develops and manufactures automated insulin delivery systems that help people with diabetes manage their blood glucose levels.

Why Should You Dump TNDM?

1. Underwhelming pump shipments over the past two years indicate demand is soft and that the company may need to revise its strategy
2. Performance over the past five years shows its incremental sales were much less profitable, as its earnings per share fell by 21% annually
3. Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution

Tandem Diabetes is trading at $13.15 per share, or 16.3x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than TNDM.

iRhythm (IRTC)

One-Year Revenue Growth: +22.4%

Pioneering the shift from bulky, short-term heart monitors to sleek, wire-free patches, iRhythm Technologies (NASDAQ: IRTC) provides wearable cardiac monitoring devices and AI-powered analysis services that help physicians detect and diagnose heart rhythm disorders.

Why Does IRTC Give Us Pause?

1. Modest revenue base of $657.2 million gives it less fixed cost leverage and fewer distribution channels than larger companies
2. Negative free cash flow raises questions about the return timeline for its investments
3. High net-debt-to-EBITDA ratio of 15× increases the risk of forced asset sales or dilutive financing if operational performance weakens

At $184.70 per share, iRhythm trades at 85.4x forward EV-to-EBITDA. Check out our free in-depth research report to learn more about why IRTC doesn’t pass our bar.

One Growth Stock to Buy:

Monolithic Power Systems (MPWR)

One-Year Revenue Growth: +34.3%

Founded in 1997 by its longtime CEO Michael Hsing, Monolithic Power Systems (NASDAQ: MPWR) is an analog and mixed signal chipmaker that specializes in power management chips meant to minimize total energy consumption.

Why Are We Backing MPWR?

1. Annual revenue growth of 29.9% over the past five years was outstanding, reflecting market share gains this cycle
2. Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends, and its improved cash conversion implies it’s becoming a less capital-intensive business
3. ROIC punches in at 45.9%, illustrating management’s expertise in identifying profitable investments

Monolithic Power Systems’s stock price of $922 implies a valuation ratio of 51.7x forward P/E. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.

High-Quality Stocks for All Market Conditions

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 5 Growth Stocks for this month. 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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