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.
Deciphering which businesses can sustain their high growth rates is a challenge for even the most seasoned professionals, which is why we started StockStory. On that note, here is one growth stock with significant upside potential and two whose momentum may slow.
Two Growth Stocks to Sell:
Flywire (FLYW)
One-Year Revenue Growth: +21%
Originally created to process international tuition payments for universities, Flywire (NASDAQ: FLYW) is a cross border payments processor and software platform focusing on complex, high-value transactions like education, healthcare and B2B payments.
Why Does FLYW Worry Us?
- High servicing costs result in a relatively inferior gross margin of 63.6% that must be offset through increased usage
- Customer acquisition costs take a while to recoup, making it difficult to justify sales and marketing investments that could increase revenue
- Track record of operating losses stem from its decision to pursue growth instead of profits
Flywire is trading at $11.03 per share, or 2.2x forward price-to-sales. Check out our free in-depth research report to learn more about why FLYW doesn’t pass our bar.
Kura Sushi (KRUS)
One-Year Revenue Growth: +21.4%
Known for its conveyor belt that transports dishes to diners, Kura Sushi (NASDAQ: KRUS) is a chain of sushi restaurants serving traditional Japanese fare with a touch of modernity and technology.
Why Are We Cautious About KRUS?
- Expenses have increased as a percentage of revenue over the last year as its operating margin fell by 4.6 percentage points
- Historically negative EPS raises concerns for risk-averse investors and makes its earnings potential harder to gauge
- Negative free cash flow raises questions about the return timeline for its investments
At $67 per share, Kura Sushi trades at 1,017.3x forward P/E. If you’re considering KRUS for your portfolio, see our FREE research report to learn more.
One Growth Stock to Watch:
agilon health (AGL)
One-Year Revenue Growth: +23.1%
Transforming how doctors care for seniors by shifting financial incentives from volume to outcomes, agilon health (NYSE: AGL) provides a platform that helps primary care physicians transition to value-based care models for Medicare patients through long-term partnerships and global capitation arrangements.
Why Could AGL Be a Winner?
- Market share has increased this cycle as its 40.5% annual revenue growth over the last two years was exceptional
- Customer trends over the past two years show it’s maintaining a steady flow of new contracts that can potentially increase in value over time
- Earnings per share grew by 14.5% annually over the last three years, massively outpacing its peers
agilon health’s stock price of $2.36 implies a valuation ratio of 0.2x forward price-to-sales. Is now the right time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.
While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 9 Market-Beating Stocks. 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 Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free.
