3 Market-Beating Stocks with Competitive Advantages

Companies that consistently increase their sales, margins, or returns on capital are usually rewarded with the best returns, and those that can do all three for years on end are almost always the legendary stocks that return 100 times your money.

Long story short, there is a near-perfect correlation between consistent earnings growth and huge winners. Taking that into account, here are three market-beating stocks with room for further growth.

Verra Mobility (VRRM)

Five-Year Return: +129%

Aiming to wrap technology and data around a historically manual and paper-based industry, Verra Mobility (NYSE:VRRM) is a leading provider of smart mobility technology to address tolls and violations, title and registration services, as well as safety and traffic enforcement.

Why Will VRRM Outperform?

1. Annual revenue growth of 15.7% over the last five years was superb and indicates its market share increased during this cycle
2. Offerings are mission-critical for businesses and lead to a best-in-class gross margin of 62.2%
3. Strong free cash flow margin of 20.2% enables it to reinvest or return capital consistently, and its growing cash flow gives it even more resources to deploy

Verra Mobility is trading at $24.85 per share, or 17.6x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.

Ameriprise Financial (AMP)

Five-Year Return: +228%

Founded in 1894 and spun off from American Express in 2005, Ameriprise Financial (NYSE:AMP) provides financial planning, wealth management, asset management, and insurance products to help individuals and institutions achieve their financial goals.

Why Are We Fans of AMP?

1. Share repurchases have increased shareholder returns as its annual earnings per share growth of 17.6% exceeded its revenue gains over the last five years
2. Impressive 27.4% annual tangible book value per share growth over the last two years indicates it’s building equity value this cycle
3. Market-beating return on equity illustrates that management has a knack for investing in profitable ventures

Ameriprise Financial’s stock price of $514.81 implies a valuation ratio of 13.1x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.

Bowhead Specialty (BOW)

Return Since IPO: +30.5%

Named after the Arctic bowhead whale known for navigating challenging waters, Bowhead Specialty Holdings (NYSE:BOW) is a specialty insurance company that provides customized coverage for complex and high-risk commercial sectors.

Why Do We Love BOW?

1. Market penetration was impressive this cycle as its net premiums earned expanded by 39.9% annually over the last two years
2. Expected revenue growth of 22.1% for the next year suggests its market share will rise
3. Performance over the past two years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 53.7% outpaced its revenue gains

At $31.06 per share, Bowhead Specialty trades at 2.4x forward P/B. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.

Stocks We Like Even More

When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.

Don’t let fear keep you from great opportunities and take a look at Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today

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