Growth is oxygen. But when it evaporates, the consequences can be severe - ask anyone who bought Cisco in the Dot-Com Bubble or newer investors who lived through the 2020 to 2022 COVID cycle.
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. That said, here is one growth stock with significant upside potential and two that could be down big.
Two Growth Stocks to Sell:
TowneBank (TOWN)
One-Year Revenue Growth: +18.1%
Founded in 1998 with a commitment to community-centered banking in the Hampton Roads region, TowneBank (NASDAQ: TOWN) is a community-focused financial institution providing banking, lending, and wealth management services to individuals and businesses in Virginia and North Carolina.
Why Does TOWN Worry Us?
- Annual revenue growth of 5.1% over the last five years was below our standards for the banking sector
- 7.2% annual net interest income growth over the last five years was slower than its banking peers
- Estimated tangible book value per share growth of 2.5% for the next 12 months implies profitability will slow from its two-year trend
TowneBank is trading at $35.17 per share, or 1.1x forward P/B. To fully understand why you should be careful with TOWN, check out our full research report (it’s free).
Eastern Bank (EBC)
One-Year Revenue Growth: +34.9%
Founded in 1818 as one of America's oldest mutual banks before converting to a public company in 2020, Eastern Bankshares (NASDAQ: EBC) operates as a bank holding company providing commercial and retail banking services primarily in Massachusetts, New Hampshire, and Rhode Island.
Why Is EBC Not Exciting?
- Net interest margin of 3.1% is well below other banks, signaling its loans aren’t very profitable
- Forecasted tangible book value per share decline of 3.6% for the upcoming 12 months implies profitability will deteriorate significantly
- Low return on equity reflects management’s struggle to allocate funds effectively
Eastern Bank’s stock price of $19.43 implies a valuation ratio of 1.1x forward P/B. Read our free research report to see why you should think twice about including EBC in your portfolio.
One Growth Stock to Buy:
Palomar Holdings (PLMR)
One-Year Revenue Growth: +54.6%
Founded in 2013 to fill gaps in catastrophe insurance markets, Palomar Holdings (NASDAQ: PLMR) is a specialty insurance provider that offers property and casualty insurance products in underserved markets, with a focus on earthquake coverage.
Why Are We Backing PLMR?
- Net premiums earned expanded by 46.1% annually over the last two years, demonstrating exceptional market penetration this cycle
- Balance sheet strength has increased this cycle as its 39.5% annual book value per share growth over the last two years was exceptional
- Notable projected book value per share growth of 25.4% for the next 12 months hints at strong capital generation
At $130.08 per share, Palomar Holdings trades at 3.7x forward P/B. Is now a good time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.
The names generating the next wave of massive growth are right here in our Top 5 Growth Stocks for this month. 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 Exlservice (+354% five-year return). Find your next big winner with StockStory today.
