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.
It’s clear there’s a strong connection between sustained earnings growth and hall-of-fame returns. Taking that into account, here are three market-beating stocks that deserve a spot on your list.
Coherent (COHR)
Five-Year Return: +384%
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 Do We Love COHR?
- Impressive 23% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Projected revenue growth of 49.3% for the next 12 months is above its two-year trend, pointing to accelerating demand
- Earnings growth has massively outpaced its peers over the last two years as its EPS has compounded at 83.7% annually
Coherent is trading at $292.13 per share, or 32.8x forward P/E. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.
Moog (MOG.A)
Five-Year Return: +439%
Responsible for the flight control actuation system integrated in the B-2 stealth bomber, Moog (NYSE: MOG.A) provides precision motion control solutions used in aerospace and defense applications
Why Does MOG.A Catch Our Eye?
- Annual revenue growth of 9.2% over the last two years beat the sector average and underscores the unique value of its offerings
- Operating margin expanded by 3 percentage points over the last five years as it scaled and became more efficient
- Earnings per share have massively outperformed its peers over the last two years, increasing by 19.1% annually
Moog’s stock price of $411.14 implies a valuation ratio of 39.5x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
Morgan Stanley (MS)
Five-Year Return: +114%
Founded in 1924 during the post-WWI economic boom by former JP Morgan partners, Morgan Stanley (NYSE: MS) is a global financial services firm that provides investment banking, wealth management, and investment management services to corporations, governments, institutions, and individuals.
Why Should MS Be on Your Watchlist?
- Market share has increased this cycle as its 17.7% annual revenue growth over the last two years was exceptional
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 39.7% exceeded its revenue gains over the last two years
- Solid 12.1% annual tangible book value per share growth over the last two years indicates its risk management practices are paying off
At $215.35 per share, Morgan Stanley trades at 16.6x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
High-Quality Stocks for All Market Conditions
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.
But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.
