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 is one mid-cap stock with huge upside potential and two that could be down big.
Two Mid-Cap Stocks to Sell:
Woodward (WWD)
Market Cap: $15.79 billion
Initially designing controls for water wheels in the early 1900s, Woodward (NASDAQ:WWD) designs, services, and manufactures energy control products and optimization solutions.
Why Are We Hesitant About WWD?
- Muted 4.9% annual revenue growth over the last five years shows its demand lagged behind its industrials peers
- Earnings per share lagged its peers over the last five years as they only grew by 7.1% annually
- Free cash flow margin dropped by 11.2 percentage points over the last five years, implying the company became more capital intensive as competition picked up
At $263.25 per share, Woodward trades at 36.9x forward P/E. Check out our free in-depth research report to learn more about why WWD doesn’t pass our bar.
Jefferies (JEF)
Market Cap: $11.53 billion
Tracing its roots back to 1962 and rebranded from Leucadia National Corporation in 2018, Jefferies Financial Group (NYSE:JEF) is a global investment banking and capital markets firm that provides advisory services, securities trading, and asset management to corporations, institutions, and wealthy individuals.
Why Do We Think Twice About JEF?
- Muted 6.6% annual revenue growth over the last five years shows its demand lagged behind its financials peers
- Performance over the past five years shows its incremental sales were less profitable, as its 5.6% annual earnings per share growth trailed its revenue gains
Jefferies is trading at $55.14 per share, or 1.2x forward P/E. To fully understand why you should be careful with JEF, check out our full research report (it’s free for active Edge members).
One Mid-Cap Stock to Buy:
Lululemon (LULU)
Market Cap: $20.12 billion
Originally serving yogis and hockey players, Lululemon (NASDAQ:LULU) is a designer, distributor, and retailer of athletic apparel for men and women.
Why Is LULU a Top Pick?
- Same-store sales growth averaged 5.3% over the past two years, showing it’s bringing new and repeat shoppers into its stores
- Differentiated product assortment leads to a best-in-class gross margin of 58.8%
- Robust free cash flow margin of 13.7% gives it many options for capital deployment
Lululemon’s stock price of $169.42 implies a valuation ratio of 14x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free for active Edge members.
High-Quality Stocks for All Market Conditions
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check 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 244% over the last five years (as of June 30, 2025).
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-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free.
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