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.
This is precisely where StockStory comes in - we do the heavy lifting to identify companies with solid fundamentals so you can invest with confidence. 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:
Lincoln Electric (LECO)
Market Cap: $11.05 billion
Headquartered in Ohio, Lincoln Electric (NASDAQ: LECO) manufactures and sells welding equipment for various industries.
Why Are We Cautious About LECO?
- Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
- Projected sales growth of 2.1% for the next 12 months suggests sluggish demand
- Earnings growth underperformed the sector average over the last two years as its EPS grew by just 5.4% annually
Lincoln Electric’s stock price of $197.92 implies a valuation ratio of 21x forward P/E. To fully understand why you should be careful with LECO, check out our full research report (it’s free).
Two Mid-Cap Stocks to Watch:
MongoDB (MDB)
Market Cap: $15.47 billion
Started in 2007 by the team behind Google’s ad platform, DoubleClick, MongoDB offers database-as-a-service that helps companies store large volumes of semi-structured data.
Why Are We Fans of MDB?
- ARR trends over the last year show it’s maintaining a steady flow of long-term contracts that contribute positively to its revenue predictability
- High switching costs and customer loyalty are evident in its net revenue retention rate of 119%
- Free cash flow margin is anticipated to expand by 5.1 percentage points over the next year, providing additional flexibility for investments and share buybacks/dividends
At $190.20 per share, MongoDB trades at 7.1x forward price-to-sales. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.
Rollins (ROL)
Market Cap: $27.32 billion
Operating under multiple brands like Orkin and HomeTeam Pest Defense, Rollins (NYSE: ROL) provides pest and wildlife control services to residential and commercial customers.
Why Will ROL Beat the Market?
- Impressive 11.9% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Offerings are difficult to replicate at scale and result in a best-in-class gross margin of 52.1%
- ROL is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
Rollins is trading at $56.37 per share, or 49x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.
While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio 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 176% over the last five years.
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 Exlservice (+354% five-year return). Find your next big winner with StockStory today for free.
