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. Taking that into account, here are three market-beating stocks with room for further growth.
BWX (BWXT)
Five-Year Return: +251%
Contributing components and materials to the famous Manhattan Project in the 1940s, BWX (NYSE: BWXT) is a manufacturer and service provider of nuclear components and fuel for government and commercial industries.
Why Is BWXT a Good Business?
- Backlog has averaged 49.9% growth over the past two years, showing it has a pipeline of unfulfilled orders that will support revenue in the future
- Projected revenue growth of 17.3% for the next 12 months is above its two-year trend, pointing to accelerating demand
- Free cash flow margin expanded by 5.7 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
BWX’s stock price of $203.64 implies a valuation ratio of 44.7x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
Watts Water Technologies (WTS)
Five-Year Return: +180%
Founded in 1874, Watts Water (NYSE: WTS) specializes in manufacturing water products and systems for residential, commercial, and industrial applications globally.
Why Will WTS Beat the Market?
- Offerings and unique value proposition resonate with customers, as seen in its above-market 10.1% annual sales growth over the last five years
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 22.2% exceeded its revenue gains over the last five years
- Free cash flow margin grew by 6.1 percentage points over the last five years, giving the company more chips to play with
Watts Water Technologies is trading at $319.80 per share, or 27.3x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
UL Solutions (ULS)
Return Since IPO: +132%
Founded in 1894 as a response to the growing dangers of electricity in American homes and businesses, UL Solutions (NYSE: ULS) provides testing, inspection, and certification services that help companies ensure their products meet safety, security, and sustainability standards.
Why Do We Watch ULS?
- Adjusted operating margin improvement of 3.1 percentage points over the last four years demonstrates its ability to scale efficiently
- Free cash flow margin increased by 7.6 percentage points over the last five years, giving the company more capital to invest or return to shareholders
- Market-beating returns on capital illustrate that management has a knack for investing in profitable ventures
At $81.06 per share, UL Solutions trades at 36.9x forward P/E. Is now the right time to buy? See for yourself in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 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.
