Companies that consistently increase their sales, margins, or returns on capital are usually rewarded with the best returns, and those that can do all three for years on end are almost always the legendary stocks that return 100 times your 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.
HubSpot (HUBS)
Five-Year Return: +189%
Started in 2006 by two MIT grad students, HubSpot (NYSE:HUBS) is a software-as-a-service platform that helps small and medium-sized businesses market themselves, sell, and get found on the internet.
Why Do We Like HUBS?
- Billings growth has averaged 19.7% over the last year, indicating a healthy pipeline of new contracts that should drive future revenue increases
- Software is difficult to replicate at scale and leads to a top-tier gross margin of 84.8%
- Operating profits and efficiency rose over the last year as it benefited from some fixed cost leverage
HubSpot’s stock price of $609.86 implies a valuation ratio of 10x forward price-to-sales. Is now the time to initiate a position? See for yourself in our full research report, it’s free.
W.W. Grainger (GWW)
Five-Year Return: +236%
Founded as a supplier of motors, W.W. Grainger (NYSE:GWW) provides maintenance, repair, and operating (MRO) supplies and services to businesses and institutions.
Why Does GWW Stand Out?
- Operating margin improvement of 5.1 percentage points over the last five years demonstrates its ability to scale efficiently
- Share repurchases over the last five years enabled its annual earnings per share growth of 18.1% to outpace its revenue gains
- Industry-leading 35.6% return on capital demonstrates management’s skill in finding high-return investments, and its returns are growing as it capitalizes on even better market opportunities
At $1,079 per share, W.W. Grainger trades at 25.9x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
Blue Bird (BLBD)
Five-Year Return: +182%
With around a century of experience, Blue Bird (NASDAQ:BLBD) is a manufacturer of school buses and complementary parts.
Why Will BLBD Outperform?
- Annual revenue growth of 16.5% over the last two years was superb and indicates its market share increased during this cycle
- Incremental sales significantly boosted profitability as its annual earnings per share growth of 156% over the last two years outstripped its revenue performance
- Rising returns on capital show management is finding more attractive investment opportunities
Blue Bird is trading at $41.45 per share, or 9.6x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth 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-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today for free.