It's easy for good opportunities in mid-cap stocks to go unnoticed by investors. Stocks with a market capitalization between $2 billion and $10 billion are sort of tweeners by definition. They often don't get the attention in the press that the market giants get, and they also can be overlooked by investors searching the small-cap universe for the giants of tomorrow.

But the best mid-cap stocks are proven businesses on their way to becoming large companies. They've already graduated from small-company status. While they may still be prioritizing investment for growth over making profits, they usually have mature business models that savvy investors can recognize as winning formulas.

The three stocks below are established businesses that are performing well in today's challenging business environment. One is a conservative choice and two are growing at breakneck speed, but all three are well positioned to succeed in 2021, regardless of the speed of the recovery.

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Triton International

International shipping volumes were already hurt by Trump Administration tariffs on Chinese goods when the COVID-19 pandemic came along and dealt a severe blow to trade in early 2020. International trade is now rebounding strongly despite the winter surge of the coronavirus, though, to the benefit of Triton International (TRTN).

Triton is the largest intermodal container leasing company in the world, the No. 1 supplier to seven of the top 10 shipping lines. The company maintains a growing fleet of containers that it lends to shippers on long-term leases of five to eight years. The trade rebound in the third quarter was unexpectedly strong, creating a container shortage that caused lease rates to soar and utilization to jump. Triton's non-GAAP earnings per share jumped 33% sequentially to $1.14. The company expects Q4 profits to rise another 25% from there to an all-time record as the company locks high leasing prices into long-term contracts.

Triton isn't just a cyclical recovery story, though. The company has grown its container fleet at a compound annual growth rate of 8% since 2006, taking advantage of the long-term growth of global trade, a shift from ownership to leasing by shipping companies, and market share gains. The business generates strong and dependable cash flow that underpins Triton's rich 4.8% dividend yield and has allowed the company to buy back 17% of outstanding shares in the last two years.

The company's stock is simultaneously a value stock selling at 8.2 times estimated 2021 earnings, a recovery story, a dividend stock, and a growth business, making the shares an attractive investment now for just about any stock investor.

Five Below

This year has been tough for retailers, but the silver lining for investors has been that the stress has exposed weaknesses in retail businesses, separating winners from losers. One retail chain that's coming through the pandemic with flying colors is Five Below (FIVE 1.25%).

The fast-growing chain of low-priced goods aimed at youthful customers has blown away expectations two quarters in a row, posting nice growth even in comparison with pre-pandemic quarters last year. On Dec. 2, Five Below reported fiscal third-quarter sales up 26% year-over-year on a comparable sales gain of 12.8%. Earnings per share doubled to $0.36. The company was able to generate that growth despite store operating hours being reduced by 25%.

Five Below's competitive advantage comes from its ability to spot trends and rapidly shift its merchandise to accommodate the current tastes of tween and teen customers at affordable price points. The company's savvy buyers focus on mostly domestic vendors with short lead times so that their stores are always filled with the latest cool stuff.

The company is aggressively adding stores. This expansion is a big contributor to sales growth. In the first nine months of 2020, the company has added 118 new stores to bring the total to 1,018. It can grow this way for a long time, given that it's only in 38 states and that the unit economics of store openings is so favorable. It only costs the company $300,000 to open a store that will typically generate $1.8 million in sales in the first year of operation. Five Below is also gradually growing its offerings of selected bargain merchandise above $5, which will help boost same-store sales.

Five Below stock is not particularly cheap at 40 times expected 2021 EPS. Still, this retail business has proved able to adapt quickly. It should be able to continue its run of substantial growth no matter what the economy throws at it.

Axon Enterprise

For mid-cap investors looking for red-hot growth that still has a long way to run, consider Axon Enterprise (AXON 1.79%). Axon makes Taser stun guns, but the bigger growth stories for the company are its body cameras and growing offerings of cloud-based software for managing the operations of law enforcement agencies.

Axon blew away expectations when it announced Q3 results in November, reporting 27% year-over-year revenue growth and a 62% jump in bookings over the previous quarter. The company had 34% sales growth of high-margin cloud software, but the segment selling cameras grew 46% as well and Taser sales rose 18%.

Axon's strategy is to sell everything on a subscription basis, and that strategy is working. Seventy-five percent of the Tasers sold in the quarter were part of a subscription bundle. The company hopes that eventually most customers will buy Taser and camera subscriptions as well as software licenses for evidence management and its communication platform, all bundled together. That alone will fuel substantial growth, but the company is also expanding from local law enforcement to federal agencies and from the U.S. to international markets.

Shares of Axon stock have a higher valuation than usual right now, but not by much. Shares sell for about 12 times trailing sales, but the stock has sold at a double-digit multiple of sales several times in the last three years. The previous peak was above 10 in the fall of 2018, and the share price has gone on to gain 62% since then. Investors revalued the stock in 2018, recognizing that the company's everything-as-a-service strategy is more directly comparable to software-as-a-service (SaaS) businesses, which are typically valued even higher than Axon is now.

Investors might be able to get a better price on Axon shares if the market turns down, but then again, maybe not. The political winds are blowing toward nonlethal policing, accountability through body cams, and more efficient spending by police departments. Axon is in the sweet spot for all of that and in the early years of a winning strategy, making it a top stock to buy now.