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Posting annualized total returns of 26% since its initialpublicoffering in 2009, OTC Markets Group (OTC: OTCM) may be one of the most surprising multibaggers on the publicly traded markets.
It has grown sales 117-fold since its initialpublicoffering (IPO) in 1993 and would have made a millionaire out of any investor who bought and held $2,500 worth of stock for the next three decades. ORLY return on invested capital; data by YCharts.
However, as a leader in this flexible metal hose niche -- primarily corrugated stainless steel tubing (CSST) -- Omega Flex (NASDAQ: OFLX) proves that monstrous returns can come from all varieties of stocks. A once-in-a-decade opportunity Regardless of when the turnaround in the growth of U.S.
Combining incredible historical total returns with robust returns on invested capital (ROIC) and steadily rising dividends , some companies are built to stand the test of time. Comparing Rollins' profitability to its debt and equity, this high ROIC shows that the company is a masterful acquirer.
Shares of beauty retailer Ulta Beauty (NASDAQ: ULTA) have more than tripled the total return of the S&P 500 since their initialpublicoffering in 2007, rising more than 1,300%. Ulta's market-beating qualities Ulta Beauty boasts a return on invested capital (ROIC) of 61%. Image Source: Getty Images.
Return on invested capital (ROIC) may be my favorite metric when looking for stocks with the ability to create lasting generational wealth. CELH Return on Invested Capital data by YCharts. Last, Ulta has averaged an ROIC of 29% since it went public and maintained positive free cash flow (FCF) every year as well.
In addition to its low-volatility shares, the company maintains a robust 25% net income margin and a towering 72% return on invested capital (ROIC). The company currently has zero debt on its balance sheet, leaving management free to return the vast majority of its net income and free cash flow (FCF) to shareholders.
The mission-critical nature of Snap-on's tools and its leadership position within its niche have combined to deliver total returns of around 11,500% since its initialpublicoffering in 1972. The company has returned over 1,800%, since 2000, nearly quadrupling the S&P 500 index's total returns.
Powersports juggernaut Polaris (NYSE: PII) has recorded total returns of nearly 30,000% since its initialpublicoffering (IPO) in 1987. To put this incredible rise in perspective, a $3,400 investment at the company's IPO would have made you a millionaire using today's share price and accumulated dividends.
Nevertheless, since its initialpublicoffering in 2005, Omega Flex has proven to be a quiet multibagger, delivering total returns above 800% -- a 13% annualized rate. ROIC measures a company's profitability compared to its debt and equity.
Rising more than 300% in the last decade and 7,000% since its 1997 initialpublicoffering, precision instrument specialist Mettler-Toledo (NYSE: MTD) may be one of the most successful stocks few investors know about.
While revenue growth slowed to 26% in its latest quarter -- with management guiding for just a 17% increase in the upcoming quarter -- Fortinet's return on invested capital (ROIC) of 132% is the second-highest in the S&P 500 Index. A stock's ROIC measures its profitability compared to its debt and equity.
Now that the Fed has issued its first rate cut, Realty Income is poised to enjoy a more friendly operating environment where debt is cheaper. The company has raised its dividend yearly since its initialpublicoffering, a streak of 31 consecutive years. As REITs go, Realty Income is one of the best.
However, I believe that many of these richly valued stocks (not all, though) trade at lofty valuations for a good reason, as they have the potential for multibagger returns over a decades-long time horizon. One such company is the fast-casual chicken wings chain Wingstop (NASDAQ: WING). With the company currently down 22% as of Dec.
Growing cash returns to shareholders Since its initialpublicoffering in 2015, Wingstop's share price has appreciated 798%, leaving the company just shy of being a nine-bagger. As this article shows, stocks with high-and-rising cash ROICs like Wingstop's have a lengthy history of producing market-stomping returns.
Medpace offers a full suite of development services for small to medium-sized biotechs, helping them get from phase I to phase IV (and beyond) in the clinical trial process. Serving this niche, Medpace has been an 11-bagger since its initialpublicoffering (IPO) in 2016 -- quintupling the S&P 500 's total returns over the same time.
And it has been a market-beating proposition since its 2013 initialpublicoffering, more than quintupling investors' returns over that time. Stocks with high and rising ROICs have historically outperformed their lower-ranked peers since they generate outsize profits compared to their debt and equity.
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