1 Growth Stock to Add to Your Roster and 2 We Avoid

Growth boosts valuation multiples, but it doesn’t always last forever. Companies that cannot maintain it are often penalized with large declines in market value, a lesson ingrained in investors who lost money in tech stocks during 2022.

Luckily for you, our job at StockStory is to help you avoid short-term fads by pointing you toward high-quality businesses that can generate sustainable long-term growth. On that note, here is one growth stock where the best is yet to come and two whose momentum may slow.

Two Growth Stocks to Sell:

DraftKings (DKNG)

One-Year Revenue Growth: +25.8%

Getting its start in daily fantasy sports, DraftKings (NASDAQ:DKNG) is a digital sports entertainment and gaming company.

Why Should You Sell DKNG?

1. 24.3% annual revenue growth over the last two years was slower than its consumer discretionary peers
2. Suboptimal cost structure is highlighted by its history of operating margin losses
3. Poor free cash flow margin of 9.5% for the last two years limits its freedom to invest in growth initiatives, execute share buybacks, or pay dividends

At $26.37 per share, DraftKings trades at 20.7x forward P/E. Dive into our free research report to see why there are better opportunities than DKNG.

Enova (ENVA)

One-Year Revenue Growth: +17.5%

Pioneering online lending since 2004 with a massive database of over 65 terabytes of customer behavior data, Enova International (NYSE:ENVA) provides online financial services including installment loans and lines of credit to non-prime consumers and small businesses in the United States and Brazil.

Why Are We Hesitant About ENVA?

1. Incremental sales over the last five years were less profitable as its 8.5% annual earnings per share growth lagged its revenue gains
2. 5× net-debt-to-EBITDA ratio shows it’s overleveraged and increases the probability of shareholder dilution if things turn unexpectedly

Enova’s stock price of $204.79 implies a valuation ratio of 11.4x forward P/E. If you’re considering ENVA for your portfolio, see our FREE research report to learn more.

One Growth Stock to Buy:

AppLovin (APP)

One-Year Revenue Growth: +51.3%

Sitting at the crossroads of the mobile advertising ecosystem with over 200 free-to-play games in its portfolio, AppLovin (NASDAQ:APP) provides software solutions that help mobile app developers market, monetize, and grow their apps through AI-powered advertising and analytics tools.

Why Are We Bullish on APP?

1. Impressive 30.4% annual revenue growth over the last two years indicates it’s winning market share
2. User-friendly software enables clients to ramp up spending quickly, leading to the speedy recovery of customer acquisition costs
3. Robust free cash flow margin of 71.9% gives it many options for capital deployment

AppLovin is trading at $469.00 per share, or 18.3x forward price-to-sales. Is now a good time to buy? Find out in our full research report, it’s free.

High-Quality Stocks for All Market Conditions

ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time.

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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 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.