Stocks that outperform the market usually share key traits such as rising sales, expanding margins, and increasing returns on capital. The select few that can do all three for many years are often the ones that make you life-changing money.
It’s clear there’s a strong connection between sustained earnings growth and hall-of-fame returns. Keeping that in mind, here are three market-beating stocks that deserve a spot on your list.
Johnson Controls (JCI)
Five-Year Return: +98.3%
Founded after patenting the electric room thermostat, Johnson Controls (NYSE: JCI) specializes in building products and technology solutions, including HVAC systems, fire and security systems, and energy storage.
Why Is JCI Interesting?
- Operating profits increased over the last five years as the company gained some leverage on its fixed costs and became more efficient
- Share buybacks catapulted its annual earnings per share growth to 17%, which outperformed its revenue gains over the last two years
- Free cash flow margin jumped by 9.9 percentage points over the last five years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
Johnson Controls’s stock price of $143.30 implies a valuation ratio of 24.2x forward P/E. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.
Primerica (PRI)
Five-Year Return: +100%
With a sales force of over 140,000 licensed representatives operating on an independent contractor model, Primerica (NYSE: PRI) provides term life insurance, investment products, and other financial services to middle-income households in the United States and Canada.
Why Should PRI Be on Your Watchlist?
- Pre-tax profit margin expanded by 6.5 percentage points over the last five years as it scaled and became more efficient
- Share repurchases over the last five years enabled its annual earnings per share growth of 17.9% to outpace its revenue gains
- Market-beating return on equity illustrates that management has a knack for investing in profitable ventures
At $288.60 per share, Primerica trades at 3.4x forward P/B. Is now the right time to buy? Find out in our full research report, it’s free.
Occidental Petroleum (OXY)
Five-Year Return: +132%
Backed by Warren Buffett's Berkshire Hathaway as a major shareholder, Occidental Petroleum (NYSE: OXY) explores for, develops, and produces oil, natural gas liquids, and natural gas, primarily in the United States and Middle East.
Why Will OXY Outperform?
- Annual revenue growth of 8.4% over the past ten years was outstanding, reflecting market share gains this cycle
- Unparalleled revenue scale of $24.47 billion gives it advantageous pricing and terms with suppliers
- Robust free cash flow margin of 23.6% gives it many options for capital deployment
Occidental Petroleum is trading at $58.88 per share, or 12x forward P/E. Is now the time to initiate a position? 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-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.
