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3 Market-Beating Stocks with Competitive Advantages
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 with room for further growth.
CoreCivic (CXW)
Five-Year Return: +250%
Originally founded in 1983 as the first private prison company in the United States, CoreCivic (NYSE:CXW) operates correctional facilities, detention centers, and residential reentry programs for government agencies across the United States.
Why Does CXW Stand Out?
- Market share has increased this cycle as its 12.4% annual revenue growth over the last two years was exceptional
- Exciting sales outlook for the upcoming 12 months calls for 15% growth, an acceleration from its two-year trend
- Share repurchases over the last two years enabled its annual earnings per share growth of 25.4% to outpace its revenue gains
CoreCivic’s stock price of $33.64 implies a valuation ratio of 16.3x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
Arthur J. Gallagher (AJG)
Five-Year Return: +84%
Founded in 1927 and operating in approximately 130 countries through direct operations and correspondent networks, Arthur J. Gallagher (NYSE:AJG) provides insurance brokerage, reinsurance, consulting, and third-party claims settlement services to businesses and individuals worldwide.
Why Is AJG a Top Pick?
- Impressive 20% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Earnings per share have massively outperformed its peers over the last five years, increasing by 18.5% annually
- Strong free cash flow margin of 17.3% enables it to reinvest or return capital consistently
At $263.87 per share, Arthur J. Gallagher trades at 18.4x forward P/E. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.
Oscar Health (OSCR)
Five-Year Return: +157%
Founded in 2012 to simplify the notoriously complex American healthcare system, Oscar Health (NYSE:OSCR) is a technology-focused health insurance company that offers individual and small group health plans through its cloud-native platform.
Why Will OSCR Beat the Market?
- Impressive 45.5% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Earnings growth has massively outpaced its peers over the last five years as its EPS has compounded at 37.4% annually
- Free cash flow margin expanded by 23.8 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
Oscar Health is trading at $31.83 per share, or 20.3x forward P/E. Is now the right time to buy? Find out in our full 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% between October 2022 and February 2026. AppLovin before it ran 753% between February 2024 and February 2026. Nvidia before it ran 1,178% between January 2023 and February 2026. 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 (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,552% between June 2020 and June 2025). Find your next big winner with StockStory today.