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. Keeping that in mind, here are three market-beating stocks with room for further growth.
Cal-Maine (CALM)
Five-Year Return: +114%
Known for brands such as Egg-Land’s Best and Land O’ Lakes, Cal-Maine (NASDAQ: CALM) produces, packages, and distributes eggs.
Why Does CALM Catch Our Eye?
- Impressive 18.5% annual revenue growth over the last three years indicates it’s winning market share
- Share buybacks catapulted its annual earnings per share growth to 34.7%, which outperformed its revenue gains over the last three years
- Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends, and its improved cash conversion implies it’s becoming a less capital-intensive business
Cal-Maine’s stock price of $80.96 implies a valuation ratio of 26.1x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Napco (NSSC)
Five-Year Return: +174%
Protecting everything from schools to government facilities since 1969, Napco Security Technologies (NASDAQ: NSSC) manufactures electronic security devices, access control systems, and communication services for intrusion and fire alarm systems.
Why Do We Love NSSC?
- Market share has increased this cycle as its 13.7% annual revenue growth over the last five years was exceptional
- Robust free cash flow margin of 18.6% gives it many options for capital deployment, and its rising cash conversion increases its margin of safety
- Improving returns on capital reflect management’s ability to monetize investments
At $38.55 per share, Napco trades at 28.5x forward P/E. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.
Coherent (COHR)
Five-Year Return: +118%
Created through the 2022 rebranding of II-VI Incorporated, a company with roots dating back to 1971, Coherent (NYSE: COHR) develops and manufactures advanced materials, lasers, and optical components for applications ranging from telecommunications to industrial manufacturing.
Why Is COHR on Our Radar?
- Annual revenue growth of 16.9% over the last five years was superb and indicates its market share increased during this cycle
- Exciting sales outlook for the upcoming 12 months calls for 15.6% growth, an acceleration from its two-year trend
- Earnings per share have massively outperformed its peers over the last two years, increasing by 38.4% annually
Coherent is trading at $195.62 per share, or 37.1x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
Check out the high-quality names we’ve flagged in our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
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 Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.
