Growth boosts valuation multiples, but it doesn’t always last forever. Companies that cannot maintain it are often penalized with large declines in market value, a lesson ingrained in investors who lost money in tech stocks during 2022.
Luckily for you, our job at StockStory is to help you avoid short-term fads by pointing you toward high-quality businesses that can generate sustainable long-term growth. On that note, here are two growth stocks with significant upside potential and one whose momentum may slow.
One Growth Stock to Sell:
Advanced Energy (AEIS)
One-Year Revenue Growth: +22.2%
Pioneering technologies for radio frequency power delivery, Advanced Energy (NASDAQ: AEIS) provides power supplies, thermal management systems, and measurement and control instruments for various manufacturing processes.
Why Does AEIS Fall Short?
- 5.6% annual revenue growth over the last five years was slower than its industrials peers
- Earnings growth over the last five years fell short of the peer group average as its EPS only increased by 5.3% annually
- Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability
Advanced Energy is trading at $356 per share, or 41.2x forward P/E. Read our free research report to see why you should think twice about including AEIS in your portfolio.
Two Growth Stocks to Watch:
Everpure (P)
One-Year Revenue Growth: +15.6%
Founded in 2009 as a pioneer in enterprise all-flash storage technology, Everpure (NYSE: P) provides all-flash data storage hardware and software that helps organizations manage their data more efficiently across on-premises and cloud environments.
Why Is P a Top Pick?
- Ability to secure long-term commitments with customers is evident in its 20.1% average ARR growth over the past two years
- Performance over the past five years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 61.7% outpaced its revenue gains
- P is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders, and its growing cash flow gives it even more resources to deploy
Everpure’s stock price of $72.75 implies a valuation ratio of 31x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Pinnacle Financial Partners (PNFP)
One-Year Revenue Growth: +50.8%
Founded in 2000 with a focus on delivering big-bank capabilities with community bank personalization, Pinnacle Financial Partners (NASDAQ: PNFP) is a Tennessee-based financial holding company that provides banking, investment, trust, mortgage, and insurance services to businesses and individuals.
Why Does PNFP Stand Out?
- 13.5% annual net interest income growth over the last five years surpassed the sector average as its loans resonated with borrowers
- Projected net interest income growth of 89.4% for the next 12 months is above its five-year trend, pointing to accelerating demand
- Annual tangible book value per share growth of 10% over the past five years was outstanding, reflecting strong capital accumulation this cycle
At $97.50 per share, Pinnacle Financial Partners trades at 1x forward P/B. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
Stocks We Like Even More
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don't just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
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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-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.
