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4 Stocks With Robust Sales Growth Worth Adding to Your Portfolio

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Key Takeaways

  • Microsoft, Textron, Bank OZK and TransUnion are highlighted for robust sales growth potential.
  • The screen focused on sales growth, cash flow above $500M and favorable valuation metrics.
  • Microsoft leads with 13.8% expected 2025 sales growth, while Bank OZK projects a 4.2% increase.

Markets started 2025 on a strong footing but have since faced considerable volatility. Tariff-related pressures and geopolitical uncertainty persist, yet expectations for a September FOMC rate cut have risen amid a softening labor market and the inflationary effects of trade policies. While investors are re-entering the market, identifying the right stocks in this environment remains challenging.

Hence, the conventional method of selecting stocks is the need of the hour. One such way is choosing stocks with steady sales growth. In this context, Microsoft Corporation (MSFT - Free Report) , Textron Inc. (TXT - Free Report) , Bank OZK (OZK - Free Report) and TransUnion (TRU - Free Report) are worth betting on.

When evaluating a company, investors often give preference to revenue over earnings, as growing sales indicate an expanding customer base and long-term potential. On the other hand, stagnant or declining revenues can signal deeper operational challenges. While short-term profits can be achieved through cost-cutting, sustained earnings growth typically depends on consistent top-line expansion.

However, revenue growth alone doesn’t paint a complete picture of financial health. An effective investment strategy involves analyzing a company’s cash position alongside its sales. Strong cash reserves and healthy cash flow offer the flexibility to navigate challenges, invest in growth opportunities and maintain operational stability.

Selecting the Potential Winning Stocks

To shortlist stocks with impressive sales growth and a high cash balance, we have selected 5-Year Historical Sales Growth (%) greater than X-Industry and Cash Flow of more than $500 million as our main screening parameters.

But sales growth and cash strength are not the absolute criteria for selecting stocks. Hence, we have added other factors to arrive at a winning strategy.

P/S Ratio less than X-Industry: This metric determines the value placed on each dollar of a company’s revenues. The lower the ratio, the better it is for picking a stock since the investor is paying less for each unit of sales.

% Change F1 Sales Estimate Revisions (four weeks) greater than X-Industry: Estimate revisions, better than the industry, are often seen to trigger an increase in stock price.

Operating Margin (average last five years) greater than 5%: Operating margin measures how much every dollar of a company's sales translates into profits. A high ratio indicates that the company has good cost control and sales are increasing faster than costs — an optimal situation.

Return on Equity (ROE) greater than 5%: This metric will ensure that sales growth is translated into profits and the company is not hoarding cash. A high ROE means that the company is spending wisely and is in all likelihood profitable.

Zacks Rank less than or equal to 2: Zacks Rank #1 (Strong Buy) or 2 (Buy) stocks are known to outperform, irrespective of the market environment. You can see the complete list of today’s Zacks #1 Rank stocks here.

4 Stocks With Solid Sales Growth to Buy Now

Redmond, WA-based Microsoft products include operating systems, cross-device productivity applications, server applications, business solution applications, desktop and server management tools, software development tools and video games. MSFT’s software solutions and hardware devices are playing an important role in developing the metaverse.

Microsoft’s expected sales growth rate for 2025 is 13.8%. MSFT carries a Zacks Rank #2 at present.

Textron, headquartered in Providence, RI, is a global multi-industry company that manufactures aircraft, automotive engine components and industrial tools. TXT also offers solutions and services for aircraft, fastening systems and industrial products and components.

Textron’s expected sales growth rate for 2025 is 7.7%. TXT currently carries a Zacks Rank #2.

Headquartered in Little Rock, AR, Bank OZK is a bank holding company registered under the Bank Holding Company Act of 1956. OZK conducts operations through 250 offices in nine states. 

Bank OZK’s sales are expected to rise 4.2% in 2025. OZK carries a Zacks Rank #2 at present.

Chicago, IL-based TransUnion is one of the leading global providers of risk and information solutions to businesses and consumers. TRU provides consumer reports, risk scores, analytical services and decision-making capabilities to businesses. 

TransUnion’s expected sales growth for 2025 is 6.9%. TRU, at present, carries a Zacks Rank #2.

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Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.

Disclosure: Performance information for Zacks’ portfolios and strategies are available at
:https://www.zacks.com/performance


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