The best-performing stocks typically have robust sales growth, increasing margins, and rising returns on capital, and those that can maintain this trifecta year in and year out often become the legends of the investing world.
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 that deserve a spot on your list.
AutoZone (AZO)
Five-Year Return: +126%
Aiming to be a one-stop shop for the DIY customer, AutoZone (NYSE: AZO) is an auto parts and accessories retailer that sells everything from car batteries to windshield wiper fluid to brake pads.
Why Are We Backing AZO?
- Locations open for at least a year are seeing increased demand as same-store sales have averaged 3.2% growth over the past two years
- Excellent operating margin of 19% highlights the efficiency of its business model
- Stellar returns on capital showcase management’s ability to surface highly profitable business ventures
AutoZone’s stock price of $3,146 implies a valuation ratio of 18.5x forward P/E. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.
Reddit (RDDT)
Return Since IPO: +248%
Founded in 2005 by two University of Virginia roommates, Reddit (NYSE: RDDT) facilitates user-generated content across niche communities (called subreddits) that discuss anything from stocks to dating and memes.
Why Will RDDT Beat the Market?
- Domestic Daily Active Visitors have grown by 14.4% annually, allowing for more profitable cross-selling opportunities if it can build complementary products and features
- Platform’s growing usage and its ability to increase user spending by 34.8% annually showcases its high switching costs
- Robust free cash flow margin of 30.1% gives it many options for capital deployment, and its growing cash flow gives it even more resources to deploy
Reddit is trading at $175.62 per share, or 22.5x forward EV/EBITDA. Is now the time to initiate a position? Find out in our full research report, it’s free.
RenaissanceRe (RNR)
Five-Year Return: +106%
Born in Bermuda after the devastating Hurricane Andrew created a crisis in the catastrophe insurance market, RenaissanceRe (NYSE: RNR) provides property, casualty, and specialty reinsurance and insurance solutions to customers worldwide, primarily through intermediaries.
Why Are We Positive on RNR?
- Strong 17.4% annualized net premiums earned expansion over the last five years shows it’s capturing market share this cycle
- Pre-tax profit margin improvement of 27.8 percentage points over the last five years demonstrates its ability to scale efficiently
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 270% exceeded its revenue gains over the last five years
At $300.83 per share, RenaissanceRe trades at 1.1x forward P/B. Is now the right time to buy? See for yourself in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI is taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies.
Our AI system flagged Palantir before it ran 1,662%. AppLovin before it ran 753%. Nvidia before it ran 1,178%. Each week it produces 6 new names that pass the same tests. Get Our Top 6 Stocks for Free HERE.
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.
