2 Growth Stocks with All-Star Potential and 1 Facing Headwinds

Growth is a hallmark of all great companies, but the laws of gravity eventually take hold. Those who rode the COVID boom and ensuing tech selloff in 2022 will surely remember that the market’s punishment can be swift and severe when trajectories fall.

The risks that can come from buying these assets are precisely why we started StockStory — to isolate the long-term winners from the losers so you can invest with confidence. Keeping that in mind, here are two growth stocks expanding their competitive advantages and one that could be down big.

One Growth Stock to Sell:

HNI (HNI)

One-Year Revenue Growth: +41.3%

With roots dating back to 1944 and a significant acquisition of Kimball International in 2023, HNI (NYSE:HNI) manufactures and sells office furniture systems, seating, and storage solutions, as well as residential fireplaces and heating products.

Why Are We Hesitant About HNI?

1. Annual earnings per share growth of 9.3% underperformed its revenue over the last two years, showing its incremental sales were less profitable
2. Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 3.6% for the last five years
3. High net-debt-to-EBITDA ratio of 6× increases the risk of forced asset sales or dilutive financing if operational performance weakens

At $39.72 per share, HNI trades at 9.1x forward P/E. To fully understand why you should be careful with HNI, check out our full research report (it’s free).

Two Growth Stocks to Buy:

Meta (META)

One-Year Revenue Growth: +26.2%

Famously founded by Mark Zuckerberg in his Harvard dorm, Meta Platforms (NASDAQ:META) operates a collection of the largest social networks in the world - Facebook, Instagram, WhatsApp, and Messenger, along with its metaverse focused Reality Labs.

Why Will META Beat the Market?

1. Customers are spending more money on its platform as its average revenue per user has increased by 27.1% annually over the last two years
2. Healthy EBITDA margin of 61.8% shows it’s a well-run company with efficient processes, and its operating leverage amplified its profits over the last few years
3. Share repurchases over the last three years enabled its annual earnings per share growth of 56% to outpace its revenue gains

Meta is trading at $655.50 per share, or 11.3x forward EV/EBITDA. Is now a good time to buy? See for yourself in our full research report, it’s free.

Lam Research (LRCX)

One-Year Revenue Growth: +26.5%

Founded in 1980 by David Lam, the man who pioneered semiconductor etching technology, Lam Research (NASDAQ:LRCX) is one of the leading providers of wafer fabrication equipment used to make semiconductors.

Why Is LRCX a Top Pick?

1. Impressive 23.4% annual revenue growth over the last two years indicates it’s winning market share this cycle
2. Disciplined cost controls and effective management resulted in a strong two-year operating margin of 32.8%, and its profits increased over the last five years as it scaled
3. Industry-leading 64.2% return on capital demonstrates management’s skill in finding high-return investments

Lam Research’s stock price of $327.09 implies a valuation ratio of 46.3x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.

Stocks We Like Even More

ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.

Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth 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-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.