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3 Market-Beating Stocks on Our Watchlist

LRCX Cover Image

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.

Long story short, there is a near-perfect correlation between consistent earnings growth and huge winners. On that note, here are three market-beating stocks that could turbocharge your returns.

Lam Research (LRCX)

Five-Year Return: +249%

Founded in 1980 by David Lam, the man who pioneered semiconductor etching technology, Lam Research (NASDAQ: LRCX) is one of the leading providers of wafer fabrication equipment used to make semiconductors.

Why Should You Buy LRCX?

  1. Annual revenue growth of 12.9% over the past five years was outstanding, reflecting market share gains this cycle
  2. Healthy operating margin of 30.5% shows it’s a well-run company with efficient processes, and its operating leverage amplified its profits over the last five years
  3. Stellar returns on capital showcase management’s ability to surface highly profitable business ventures

At $105.10 per share, Lam Research trades at 26x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.

Vita Coco (COCO)

Return Since IPO: +186%

Founded in 2004 followed by a 2021 IPO, The Vita Coco Company (NASDAQ: COCO) offers coconut water products that are a natural way to quench thirst.

Why Do We Watch COCO?

  1. Products are seeing elevated demand as its unit sales averaged 7.8% growth over the past two years
  2. Earnings per share have massively outperformed its peers over the last three years, increasing by 195% annually
  3. ROIC punches in at 47.7%, illustrating management’s expertise in identifying profitable investments, and its returns are growing as it capitalizes on even better market opportunities

Vita Coco is trading at $38.69 per share, or 29.7x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.

Wabtec (WAB)

Five-Year Return: +179%

Also known as Wabtec, Westinghouse Air Brake Technologies (NYSE: WAB) provides equipment, systems, and related software for the railway industry.

Why Is WAB Interesting?

  1. Operating profits and efficiency rose over the last five years as it benefited from some fixed cost leverage
  2. Performance over the past two years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
  3. Robust free cash flow margin of 11.6% gives it many options for capital deployment, and its growing cash flow gives it even more resources to deploy

Wabtec’s stock price of $190.93 implies a valuation ratio of 26.6x forward EV-to-EBITDA. Is now a good time to buy? See for yourself in our full 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 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-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

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.

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