Growth is a hallmark of all great companies, but the laws of gravity eventually take hold. Those who rode the COVID boom and ensuing tech selloff in 2022 will surely remember that the market’s punishment can be swift and severe when trajectories fall.
The risks that can come from buying these assets are precisely why we started StockStory — to isolate the long-term winners from the losers so you can invest with confidence. Keeping that in mind, here are two growth stocks with significant upside potential and one facing an uphill battle.
One Growth Stock to Sell:
nLIGHT (LASR)
One-Year Revenue Growth: +40.9%
Founded by a former CEO and Harvard-educated entrepreneur Scott Keeneyn, nLIGHT (NASDAQ: LASR) offers semiconductor and fiber lasers to the industrial, aerospace & defense, and medical sectors.
Why Are We Wary of LASR?
- Sales trends were unexciting over the last five years as its 3.8% annual growth was below the typical industrials company
- Poor expense management has led to operating margin losses
- Negative free cash flow raises questions about the return timeline for its investments
At $80.70 per share, nLIGHT trades at 174.4x forward P/E. If you’re considering LASR for your portfolio, see our FREE research report to learn more.
Two Growth Stocks to Buy:
Sanmina (SANM)
One-Year Revenue Growth: +44.5%
Founded in 1980, Sanmina (NASDAQ: SANM) is an electronics manufacturing services company offering end-to-end solutions for various industries.
Why Is SANM a Top Pick?
- Market share has increased this cycle as its 19.3% annual revenue growth over the last two years was exceptional
- Demand for the next 12 months is expected to accelerate above its two-year trend as Wall Street forecasts robust revenue growth of 29.3%
- Share repurchases over the last two years enabled its annual earnings per share growth of 25.3% to outpace its revenue gains
Sanmina is trading at $265.94 per share, or 22.1x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
Kinsale Capital Group (KNSL)
One-Year Revenue Growth: +17%
Founded in 2009 during the aftermath of the financial crisis when many insurers were retreating from riskier markets, Kinsale Capital Group (NYSE: KNSL) is an insurance company that specializes in writing policies for hard-to-place, unusual, or high-risk businesses that standard insurers typically avoid.
Why Is KNSL a Good Business?
- Net premiums earned expanded by 18.8% annually over the last two years, demonstrating exceptional market penetration this cycle
- Incremental sales significantly boosted profitability as its annual earnings per share growth of 42.9% over the last five years outstripped its revenue performance
- Annual book value per share growth of 30.2% over the past two years was outstanding, reflecting strong capital accumulation this cycle
Kinsale Capital Group’s stock price of $306.10 implies a valuation ratio of 3.3x 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
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 Kadant (+351% five-year return). Find your next big winner with StockStory today.
