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.
It’s clear there’s a strong connection between sustained earnings growth and hall-of-fame returns. Taking that into account, here are three market-beating stocks that deserve a spot on your list.
Primoris (PRIM)
Five-Year Return: +307%
Listed on the NASDAQ in 2008, Primoris (NYSE: PRIM) builds, maintains, and upgrades infrastructure in the utility, energy, and civil construction industries.
Why Does PRIM Stand Out?
- Market share has increased this cycle as its 16.2% annual revenue growth over the last two years was exceptional
- Backlog has averaged 148% growth over the past two years, showing it has a pipeline of unfulfilled orders that will support revenue in the future
- Earnings per share grew by 27% annually over the last two years and trumped its peers
Primoris’s stock price of $73.52 implies a valuation ratio of 16.4x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Arlo Technologies (ARLO)
Five-Year Return: +445%
Originally spun off from networking equipment maker Netgear in 2018, Arlo Technologies (NYSE: ARLO) provides cloud-based smart security devices and subscription services that help consumers and businesses monitor and protect their homes, properties, and loved ones.
Why Are We Fans of ARLO?
- Operating margin profits and efficiency rose over the last five years as it benefited from some fixed cost leverage
- Incremental sales significantly boosted profitability as its annual earnings per share growth of 193% over the last two years outstripped its revenue performance
- Free cash flow margin jumped by 19.7 percentage points over the last five years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
At $14.22 per share, Arlo Technologies trades at 22.9x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
Barrett (BBSI)
Five-Year Return: +214%
Operating as a professional employer organization (PEO) that serves over 8,000 companies with more than 120,000 worksite employees, Barrett Business Services (NASDAQ: BBSI) provides management solutions that help small and mid-sized businesses handle human resources, payroll, workers' compensation, and other administrative functions.
Why Do We Like BBSI?
- Operating margin profits increased over the last five years as the company gained some leverage on its fixed costs and became more efficient
- Stellar returns on capital showcase management’s ability to surface highly profitable business ventures, and its returns are growing as it capitalizes on even better market opportunities
- Improving returns on capital reflect management’s ability to monetize investments
Barrett is trading at $41.69 per share, or 18.4x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.
While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio by checking out our Top 9 Market-Beating Stocks. 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.
