The Best CAGR Stocks to Own: 7 Growth Champions Delivering 20% Annual Returns

Hunting for best CAGR stocks that can sustain 20% annual returns is a quest most investors never finish. Looking back over the last 20 years of market history, only a handful of portfolios have managed this feat. Warren Buffett’s legendary track record generated 9.91% compound annual returns—stellar by most measures, yet it pales against what the Nasdaq achieved. Reaching that 20% threshold would require doubling your portfolio every 3.6 years, a pace that demands not just luck, but structural advantage and flawless execution.

Yet it’s entirely possible. The market doesn’t reward complacency, but it does reward companies with tailwinds, operational excellence, and visionary leadership. After analyzing recent quarterly results and forward guidance across multiple sectors, seven stocks have emerged as candidates capable of delivering this outsized performance. These best CAGR stocks aren’t one-trick ponies either—they’re solving real market problems while riding secular trends that should persist for years.

Why These 7 Stocks Stand Out Over 20 Years of Market Performance

The criteria for selecting best CAGR stocks is straightforward: revenue growth exceeding 15%, operating leverage that translates to earnings expansion, and tailwinds strong enough to justify premium valuations. Over the past 20 years, stocks meeting these standards have consistently outperformed both the S&P 500 and broader market averages.

What makes today different is that we’re at an inflection point. Technology adoption is accelerating, aerospace demand is surging, e-commerce competition is reshaping consumer behavior, and cloud infrastructure is becoming mission-critical. Companies positioned at these intersections tend to compound at rates that turn modest investments into significant wealth.

The following seven stocks represent different sectors but share a common trait: they’re executing better than peers and expanding market share while improving profitability. Here’s what the numbers reveal.

Axon Enterprise: Law Enforcement Innovation Fueling CAGR Performance

Axon Enterprise (NASDAQ: AXON) manufactures equipment and software for law enforcement and public safety. Beyond tasers—the company’s most recognized product—Axon has become an indispensable software platform for police departments nationwide.

The 2024 first-quarter results validated this diversification strategy. Revenue climbed 34% to $461 million, crushing analyst expectations by $19 million. Earnings per share reached $1.15, significantly ahead of projections. But the headline numbers tell only part of the story.

What truly excites analysts about Axon’s CAGR potential is its pipeline of transformational initiatives. The planned acquisition of Dedrone positions law enforcement to deploy drone technology for emergency response—something previously constrained by FAA limitations. Meanwhile, Draft One, an AI-assisted administrative software, promises officers 15 hours weekly in reclaimed time. That translates to more community engagement and operational efficiency.

With management projecting 20% annual growth in both revenue and earnings over the medium term, Axon appears well-positioned to deliver consistent CAGR returns as long as market valuations hold and social pressures continue driving public safety budgets higher.

Celsius Holdings: Energy Drink Growth Trajectory

Celsius Holdings (NASDAQ: CELH) entered 2024 with stunning momentum. First-quarter revenue surged 37% year-over-year to $355.7 million, capturing 11.5% of the energy drink market—up a full point year-over-year. Meanwhile, the entire energy drink segment expanded 47%, and Celsius contributed disproportionately to that growth.

The company isn’t resting on its success. New product lines like Galaxy Vibe and CELSIUS Essentials are resonating with consumers, and management highlighted significant shelf-space gains expected from spring resets across major retailers. This product innovation cycle, combined with increasing brand loyalty, suggests the company can sustain 20%-plus annual gains.

Investors do pay a premium for CELH stock, but as long as the company executes on its ambition to become the world’s leading energy drink brand, the valuation appears justified. The company has demonstrated operational discipline, and consumer demand remains robust despite economic uncertainty.

Aerospace Resurgence: Howmet Leading the Recovery

Howmet Aerospace (NYSE: HWM) manufactures advanced materials and components for the aerospace and transportation sectors. Over the past year, HWM stock has risen nearly 95%, and there’s compelling evidence the advance can continue.

In 2024’s opening quarter, revenue reached a record $1.82 billion, up 14% year-over-year. The commercial aerospace segment delivered the real fireworks: 23% growth in that division alone. Tax policy tailwinds—particularly the Trump administration’s business-friendly depreciation rules—have accelerated aircraft purchases for corporate operators, creating a multi-year demand cycle.

Even more impressive was the operational leverage: EBITDA expanded 21%, with margin expansion of 150 basis points. Earnings per share grew 36%. The company’s balance sheet strengthened too, with net debt-to-EBITDA dropping to 2-to-1—a record low positioning Howmet as a potential cash generation machine.

Management has demonstrated flawless execution, delivering 12 consecutive quarters of robust aerospace gains while strategically expanding transportation market share. For investors seeking best CAGR stocks in capital-intensive sectors, Howmet’s combination of cyclical tailwinds and operational excellence makes it compelling.

E-Commerce Explosion: PDD Holdings Reshaping Retail

PDD Holdings (NASDAQ: PDD) operates Temu and related marketplaces, connecting millions of budget-conscious shoppers with products at unprecedented price points. The app has become one of the most downloaded globally, a remarkable achievement given intense competition from established giants.

The 2024 first-quarter results were extraordinary: revenue jumped 131% year-over-year to 86.8 billion yuan ($11.99 billion), obliterating analyst expectations by $1.41 billion. This kind of CAGR performance doesn’t happen by accident—it reflects a fundamental shift in consumer behavior toward value-driven shopping.

PDD is wisely investing resources to expand product selection, partner with premium global brands, and provide merchants with cost-reduction tools. As Chinese consumers increasingly demand higher-quality goods at accessible prices, PDD’s platform economics should support continued expansion. The company is among the best CAGR stocks for investors bullish on emerging-market e-commerce consolidation.

Industrial Services Evolution: Plexus and Manhattan Associates

Plexus Corp. (NASDAQ: PLXS) provides design, manufacturing, and aftermarket services across industrial, healthcare, aerospace, and communications sectors. The stock has delivered approximately 20% annual returns historically, with a 128% five-year gain. Recent fiscal results suggest this performance can repeat.

Fiscal Q2 2024 revenue reached $967 million, with non-GAAP earnings per share of 94 cents—both beating expectations. Management’s go-to-market strategy generated $255 million in new program wins, signaling robust demand. Operating margin expansion is underway, targeting 5.5% GAAP by late 2025. Free cash flow production reached $65 million with management guiding toward $100 million annually, supporting shareholder returns.

Manhattan Associates (NASDAQ: MANH) provides cloud-based supply chain and e-commerce solutions, a segment experiencing structural tailwinds. First-quarter 2024 revenue grew 15% to $255 million with adjusted earnings per share surging 29% to $1.03—both beating estimates handily. Cloud revenue expanded 36%, while services revenue climbed 14%.

Most notably, the backlog swelled 31% to over $1.5 billion, reflecting sustained demand for cloud infrastructure and digital transformation services. With over 100 implementations completed in Q1 and continued innovation investment, Manhattan appears positioned for years of double-digit growth. At 14% below its March peak, the stock offers compelling entry timing for investors seeking best CAGR stocks in cloud infrastructure.

Travel Platform Dominance: Booking Holdings Endures

Booking Holdings (NASDAQ: BKNG) operates Booking.com, Priceline, and Kayak—dominant platforms in travel commerce. While travel cycles do exist, Booking’s structural advantages suggest sustained returns.

First-quarter 2024 revenue grew 17% to $4.4 billion, while adjusted EBITDA surged 53% to $900 million—outsize operating leverage in action. The stock advanced 129% over five years and carries a 0.9% dividend yield. Analysts project around 20% annual earnings per share growth through 2029.

Recent innovation, particularly “connected trips” where travelers simultaneously book flights and hotels, is gaining rapid adoption. This feature expands revenue per booking while improving the customer experience. Summer travel momentum remained healthy despite Middle East tensions, and booking patterns suggest resilience.

Building Your Portfolio: Beyond Best CAGR Stocks

Reaching 20% annual returns requires concentration in growth vehicles, yet concentration risks demand mitigation. These seven best CAGR stocks represent diverse sectors—safety technology, consumer staples, aerospace, e-commerce, industrial services, and travel—offering natural hedges.

However, don’t deploy entire portfolios into CAGR equities. Allocate defensive positions and dividend-paying stocks alongside these growth engines for portfolio ballast. Market cycles persist, valuations mean-revert, and overextension breeds regret.

That said, for growth-oriented portfolios targeting outsized returns, these seven stocks warrant serious consideration. Their recent fundamental strength, management execution, and structural tailwinds position them to deliver the performance required to double wealth every 3-4 years. That’s the reward for recognizing best CAGR stocks at inflection points.