Growth is oxygen. But when it evaporates, the consequences can be severe - ask anyone who bought Cisco in the Dot-Com Bubble or newer investors who lived through the 2020 to 2022 COVID cycle.
Deciphering which businesses can sustain their high growth rates is a challenge for even the most seasoned professionals, which is why we started StockStory. Keeping that in mind, here are three growth stocks whose best days may be over and some alternatives you should consider instead.
Twilio (TWLO)
One-Year Revenue Growth: +15.7%
Known for the clever "Twilio Magic" demo that had developers creating functioning communications apps in minutes, Twilio (NYSE: TWLO) provides a platform that enables businesses to communicate with their customers through voice, messaging, email, and other digital channels.
Why Are We Cautious About TWLO?
- Customers generally do not adopt complementary products as its 110% net revenue retention rate lags behind the industry standard
- Gross margin of 48.7% reflects its high servicing costs
- Operating profits increased over the last year as the company gained some leverage on its fixed costs and became more efficient
Twilio’s stock price of $209.69 implies a valuation ratio of 5.5x forward price-to-sales. Dive into our free research report to see why there are better opportunities than TWLO.
Franklin BSP Realty Trust (FBRT)
One-Year Revenue Growth: +50%
Operating as a specialized real estate investment trust (REIT) with roots dating back to 2012, Franklin BSP Realty Trust (NYSE: FBRT) originates and manages a diversified portfolio of commercial real estate debt investments secured by properties in the United States and abroad.
Why Should You Sell FBRT?
- Net interest income stagnated over the last five years and signals the need for new growth strategies
- Earnings per share have dipped by 7.5% annually over the past three years, which is concerning because stock prices follow EPS over the long term
- Underwhelming 4.5% return on equity reflects management’s difficulties in finding profitable growth opportunities
Franklin BSP Realty Trust is trading at $8.08 per share, or 0.6x forward P/B. If you’re considering FBRT for your portfolio, see our FREE research report to learn more.
Excelerate Energy (EE)
One-Year Revenue Growth: +39.3%
Operating specialized vessels that can deliver up to 1.2 billion cubic feet of natural gas per day, Excelerate Energy (NYSE: EE) provides liquified natural gas regasification services using floating vessels that convert LNG back into natural gas.
Why Does EE Worry Us?
- Smaller revenue base of $1.35 billion means it hasn’t achieved the economies of scale that some industry juggernauts enjoy
- Gross margin of 29.5% is below its competitors, leaving less money to invest in exploration and production
At $38.01 per share, Excelerate Energy trades at 22.5x forward P/E. Read our free research report to see why you should think twice about including EE in your portfolio.
Stocks We Like 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 (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
