Growth is oxygen. But when it evaporates, the consequences can be extreme - ask anyone who bought Cisco in the Dot-Com Bubble (Nvidia?) or newer investors who lived through the 2020 to 2022 COVID cycle.
The risks that can come from buying these assets is precisely why we started StockStory - to isolate the long-term winners from the losers so you can invest with confidence. On that note, here are two growth stocks where the best is yet to come and one that could be down big.
One Growth Stock to Sell:
Ameresco (AMRC)
One-Year Revenue Growth: +28.8%
Having played a role in upgrading the energy solutions of Alcatraz Island, Ameresco (NYSE: AMRC) provides energy and renewable energy solutions for various sectors.
Why Does AMRC Worry Us?
- Annual sales declines of 1.5% for the past two years show its products and services struggled to connect with the market during this cycle
- Cash-burning tendencies make us wonder if it can sustainably generate shareholder value
- Short cash runway increases the probability of a capital raise that dilutes existing shareholders
Ameresco’s stock price of $10.50 implies a valuation ratio of 6.8x forward price-to-earnings. Check out our free in-depth research report to learn more about why AMRC doesn’t pass our bar.
Two Growth Stocks to Buy:
Monday.com (MNDY)
One-Year Revenue Growth: +33.2%
Founded in 2014 and named after the dreaded first day of the work week, Monday.com (NASDAQ: MNDY) is a software-as-a-service platform that helps organizations plan and track work efficiently.
Why Should You Buy MNDY?
- Ability to secure long-term commitments with customers is evident in its 33.3% ARR growth over the last year
- Prominent and differentiated software leads to a best-in-class gross margin of 89.3%
- Robust free cash flow margin of 30.4% gives it many options for capital deployment
At $263 per share, Monday.com trades at 11.1x forward price-to-sales. Is now the right time to buy? Find out in our full research report, it’s free.
Abercrombie and Fitch (ANF)
One-Year Revenue Growth: +15.6%
Founded as an outdoor and sporting brand, Abercrombie & Fitch (NYSE: ANF) evolved to become a specialty retailer that sells its own brand of fashionable clothing to young adults.
Why Will ANF Outperform?
- Comparable store sales rose by 14.6% on average over the past two years, demonstrating its ability to drive increased spending at existing locations
- Share buybacks catapulted its annual earnings per share growth to 76.8%, which outperformed its revenue gains over the last five years
- ANF is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
Abercrombie and Fitch is trading at $80.48 per share, or 7x forward price-to-earnings. Is now a good time to buy? See for yourself in our full research report, it’s free.
Stocks We Like Even More
The Trump trade may have passed, but rates are still dropping and inflation is still cooling. Opportunities are ripe for those ready to act - and we’re here to help you pick them.
Get started by checking out 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 175% over the last five years.
Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like United Rentals (+322% five-year return). Find your next big winner with StockStory today for free.
