Mid-cap stocks often strike the right balance between having proven business models and market opportunities that can support $100 billion corporations. However, they face intense competition from scaled industry giants and can be disrupted by new innovative players vying for a slice of the pie.
These dynamics can rattle even the most seasoned professionals, which is why we started StockStory - to help you separate the good companies from the bad. Keeping that in mind, here are two mid-cap stocks with massive growth potential and one that may have trouble.
One Mid-Cap Stock to Sell:
Burlington (BURL)
Market Cap: $15.56 billion
Founded in 1972 as a discount coat and outerwear retailer, Burlington Stores (NYSE: BURL) is now an off-price retailer that has broadened into general apparel, footwear, and home goods.
Why Does BURL Worry Us?
- Annual sales growth of 8% over the last six years lagged behind its consumer retail peers as its large revenue base made it difficult to generate incremental demand
- Free cash flow margin dropped by 7.5 percentage points over the last year, implying the company became more capital intensive as competition picked up
- ROIC of 8.5% reflects management’s challenges in identifying attractive investment opportunities
Burlington’s stock price of $249.85 implies a valuation ratio of 26.1x forward P/E. If you’re considering BURL for your portfolio, see our FREE research report to learn more.
Two Mid-Cap Stocks to Watch:
VeriSign (VRSN)
Market Cap: $26.42 billion
While the company is not a domain registrar and does not directly sell domain names to end users, Verisign (NASDAQ: VRSN) operates and maintains the infrastructure to support domain names such as .com and .net.
Why Should VRSN Be on Your Watchlist?
- Average billings growth of 15.6% over the last year enhances its liquidity and shows there is steady demand for its products
- Software is difficult to replicate at scale and leads to a best-in-class gross margin of 87.8%
- Robust free cash flow margin of 57.5% gives it many options for capital deployment
VeriSign is trading at $282.79 per share, or 16.3x forward price-to-sales. Is now the time to initiate a position? Find out in our full research report, it’s free.
Centene (CNC)
Market Cap: $15.64 billion
Serving nearly 1 in 15 Americans through its government healthcare programs, Centene (NYSE: CNC) is a healthcare company that manages government-sponsored health insurance programs like Medicaid and Medicare for low-income and complex-needs populations.
Why Do We Like CNC?
- Annual revenue growth of 15.5% over the last five years beat the sector average and underscores the unique value of its offerings
- Dominant market position is represented by its $169.3 billion in revenue, which gives it negotiating power over membership pricing and reimbursement rates
- Earnings growth has massively outpaced its peers over the last five years as its EPS has compounded at 14.8% annually
At $31.40 per share, Centene trades at 4.1x forward P/E. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
High-Quality Stocks for All Market Conditions
Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.
While this has caused many investors to adopt a "fearful" wait-and-see approach, we’re leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our 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-small-cap company Comfort Systems (+782% 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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