Stocks that outperform the market usually share key traits such as rising sales, expanding margins, and increasing returns on capital. The select few that can do all three for many years are often the ones that make you life-changing money.
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 deserve a spot on your list.
Samsara (IOT)
Return Since IPO: +71.6%
One of the few public companies where famed investor Marc Andreessen is a Board member, Samsara (NYSE:IOT) provides software and hardware to track industrial equipment, assets, and fleets.
Why Are We Backing IOT?
- ARR trends over the last year show it’s maintaining a steady flow of long-term contracts that contribute positively to its revenue predictability
- Revenue outlook for the upcoming 12 months is outstanding and shows it’s on track to gain market share
- Operating profits increased over the last year as the company gained some leverage on its fixed costs and became more efficient
Samsara is trading at $42.39 per share, or 14.7x forward price-to-sales. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
Watts Water Technologies (WTS)
Five-Year Return: +205%
Founded in 1874, Watts Water (NYSE:WTS) specializes in manufacturing water products and systems for residential, commercial, and industrial applications globally.
Why Is WTS Interesting?
- Superior product capabilities and pricing power lead to a top-tier gross margin of 45%
- Operating margin improvement of 4.5 percentage points over the last five years demonstrates its ability to scale efficiently
- Share buybacks catapulted its annual earnings per share growth to 16.9%, which outperformed its revenue gains over the last five years
Watts Water Technologies’s stock price of $244.80 implies a valuation ratio of 26.4x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Super Micro (SMCI)
Five-Year Return: +1,371%
Founded in Silicon Valley in 1993 and known for its modular "building block" approach to server design, Super Micro Computer (NASDAQ:SMCI) designs and manufactures high-performance, energy-efficient server and storage systems for data centers, cloud computing, AI, and edge computing applications.
Why Are We Bullish on SMCI?
- Annual revenue growth of 81.1% over the past two years was outstanding, reflecting market share gains this cycle
- Earnings per share have massively outperformed its peers over the last five years, increasing by 23.2% annually
- Improving returns on capital reflect management’s ability to monetize investments
At $42.99 per share, Super Micro trades at 14x forward P/E. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.
While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like 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 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 Tecnoglass (+1,754% 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.