Mid-cap stocks often strike the right balance between having proven business models and market opportunities that can support $100 billion corporations. However, they face intense competition from scaled industry giants and can be disrupted by new innovative players vying for a slice of the pie.

These dynamics can rattle even the most seasoned professionals, which is why we started StockStory - to help you separate the good companies from the bad. That said, here are two mid-cap stocks with long growth runways and one best left ignored.

One Mid-Cap Stock to Sell:

Tapestry (TPR)

Market Cap: $15.09 billion

Originally founded as Coach, Tapestry (NYSE: TPR) is an American fashion conglomerate with a portfolio of luxury brands offering high-quality accessories and fashion products.

Why Does TPR Worry Us?

1. Annual revenue growth of 1.4% over the last two years was below our standards for the consumer discretionary sector
2. Underwhelming constant currency revenue performance over the past two years suggests its product offering at current prices doesn’t resonate with customers
3. Estimated sales growth of 3% for the next 12 months is soft and implies weaker demand

Tapestry is trading at $72 per share, or 14.7x forward price-to-earnings. To fully understand why you should be careful with TPR, check out our full research report (it’s free).

Two Mid-Cap Stocks to Watch:

Dynatrace (DT)

Market Cap: $14.86 billion

Founded in Austria in 2005, Dynatrace (NYSE: DT) provides companies with software that allows them to monitor the performance of their full technology stack, from software applications to the infrastructure they run on.

Why Could DT Be a Winner?

1. ARR growth averaged 18.9% over the last year, showing customers are willing to take multi-year bets on its offerings
2. Software is difficult to replicate at scale and leads to a stellar gross margin of 82.2%
3. Robust free cash flow margin of 24.9% gives it many options for capital deployment

Dynatrace’s stock price of $49.50 implies a valuation ratio of 8.1x forward price-to-sales. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.

Brown-Forman (BF.B)

Market Cap: $16.39 billion

Best known for its Jack Daniel’s whiskey, Brown-Forman (NYSE: BF.B) is an alcoholic beverage company with a broad portfolio of brands in wines and spirits.

Why Are We Fans of BF.B?

1. Unique products and pricing power lead to a best-in-class gross margin of 60.2%
2. Highly efficient business model is illustrated by its impressive 28.6% operating margin, and it turbocharged its profits by achieving some fixed cost leverage
3. Market-beating returns on capital illustrate that management has a knack for investing in profitable ventures

At $34.75 per share, Brown-Forman trades at 16.9x forward price-to-earnings. Is now the time to initiate a position? Find out in our full research report, it’s free.

Stocks We Like Even More

The elections are now behind us. With rates dropping and inflation cooling, many analysts expect a breakout market - and we’re zeroing in on the stocks that could benefit immensely.

Take advantage of the rebound by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years.

Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Axon (+711% five-year return). Find your next big winner with StockStory today for free.