The stocks featured in this article are seeing some big returns. Over the past month, they’ve outpaced the market due to new product launches, positive news, or even a dedicated social media following.
While momentum can be a leading indicator, it has burned many investors as it doesn’t always correlate with long-term success. All that said, here are three stocks getting more buzz than they deserve and some you should buy instead.
Seagate Technology (STX)
One-Month Return: +23.6%
The developer of the original 5.25inch hard disk drive, Seagate (NASDAQ: STX) is a leading producer of data storage solutions, including hard drives and Solid State Drives (SSDs) used in PCs and data centers.
Why Are We Wary of STX?
- Annual sales declines of 3.8% for the past five years show its products and services struggled to connect with the market during this cycle
- Gross margin of 28.4% reflects its high production costs
- Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 8.3% for the last two years
Seagate Technology is trading at $152.33 per share, or 17x forward P/E. If you’re considering STX for your portfolio, see our FREE research report to learn more.
Advanced Energy (AEIS)
One-Month Return: +15.8%
Pioneering technologies for radio frequency power delivery, Advanced Energy (NASDAQ: AEIS) provides power supplies, thermal management systems, and measurement and control instruments for various manufacturing processes.
Why Are We Out on AEIS?
- Annual sales declines of 8.8% for the past two years show its products and services struggled to connect with the market during this cycle
- Free cash flow margin shrank by 6.6 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive
- Diminishing returns on capital suggest its earlier profit pools are drying up
Advanced Energy’s stock price of $137.56 implies a valuation ratio of 27.5x forward P/E. To fully understand why you should be careful with AEIS, check out our full research report (it’s free).
Blink Charging (BLNK)
One-Month Return: +18.3%
One of the first EV charging companies to go public, Blink Charging (NASDAQ: BLNK) is a manufacturer, owner, operator, and provider of electric vehicle charging equipment and networked EV charging services.
Why Are We Cautious About BLNK?
- Earnings per share fell by 8.7% annually over the last five years while its revenue grew, partly because it diluted shareholders
- Cash-burning tendencies make us wonder if it can sustainably generate shareholder value
- Short cash runway increases the probability of a capital raise that dilutes existing shareholders
At $0.93 per share, Blink Charging trades at 0.9x forward price-to-sales. Read our free research report to see why you should think twice about including BLNK in your portfolio.
High-Quality Stocks for All Market Conditions
The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.
While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
