2 Mid-Cap Stocks with Solid Fundamentals and 1 Facing Challenges

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.

Luckily for you, our mission at StockStory is to help you make money and avoid losses by sorting the winners from the losers. That said, here are two mid-cap stocks with huge upside potential and one best left ignored.

One Mid-Cap Stock to Sell:

Northern Trust (NTRS)

Market Cap: $25.75 billion

Founded in 1889 during Chicago's post-Great Fire rebuilding boom, Northern Trust (NASDAQ:NTRS) provides wealth management, asset servicing, and banking solutions to corporations, institutions, families, and high-net-worth individuals globally.

Why Are We Wary of NTRS?

1. Muted 5.8% annual revenue growth over the last five years shows its demand lagged behind its financials peers
2. Earnings growth underperformed the sector average over the last five years as its EPS grew by just 9.3% annually

Northern Trust’s stock price of $136.81 implies a valuation ratio of 14.2x forward P/E.

Two Mid-Cap Stocks to Watch:

Domino's (DPZ)

Market Cap: $13.73 billion

Founded by two brothers in Michigan, Domino’s (NYSE:DPZ) is a globally recognized pizza chain known for its creative marketing and fast delivery.

Why Are We Positive On DPZ?

1. Rapid rollout of new restaurants to capitalize on market opportunities makes sense given its strong same-store sales performance
2. Excellent operating margin of 19% highlights the efficiency of its business model
3. Free cash flow margin jumped by 2.7 percentage points over the last year, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends

At $407.82 per share, Domino's trades at 20.3x forward P/E. Is now the right time to buy?

Texas Roadhouse (TXRH)

Market Cap: $11.31 billion

With locations often featuring Western-inspired decor, Texas Roadhouse (NASDAQ:TXRH) is an American restaurant chain specializing in Southern-style cuisine and steaks.

Why Does TXRH Stand Out?

1. Fast expansion of new restaurants to reach markets with few or no locations is justified by its same-store sales growth
2. Customers are lining up to eat at its restaurants as the company’s same-store sales growth averaged 6.7% over the past two years
3. Industry-leading 21% return on capital demonstrates management’s skill in finding high-return investments

Texas Roadhouse is trading at $169.40 per share, or 27.9x forward P/E. Is now a good time to buy?

Stocks We Like Even More

WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don't just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.

But our AI platform says the party isn't over. Find out which 9 stocks made the cut this week — FREE.

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).