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.

However, not all companies with momentum are long-term winners, and many investors have lost money by following short-term trends. All that said, here are three stocks that are likely overheated and some you should look into instead.

Genco (GNK)

One-Month Return: +18.5%

Headquartered in NYC, Genco (NYSE: GNK) is a shipping company that transports dry bulk cargo along worldwide maritime routes.

Why Do We Steer Clear of GNK?

1. Number of owned vessels has disappointed over the past two years, indicating weak demand for its offerings
2. Earnings per share have dipped by 43.6% annually over the past two years, which is concerning because stock prices follow EPS over the long term
3. Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 6.5 percentage points

Genco is trading at $15.70 per share, or 24.3x forward P/E. To fully understand why you should be careful with GNK, check out our full research report (it’s free).

Thermo Fisher (TMO)

One-Month Return: +11.8%

With over 14,000 sales personnel and a portfolio spanning more than 2,500 technology manufacturers, Thermo Fisher Scientific (NYSE: TMO) provides scientific equipment, reagents, consumables, software, and laboratory services to pharmaceutical, biotech, academic, and healthcare customers worldwide.

Why Are We Hesitant About TMO?

1. Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
2. Expenses have increased as a percentage of revenue over the last five years as its adjusted operating margin fell by 10.2 percentage points
3. Waning returns on capital imply its previous profit engines are losing steam

Thermo Fisher’s stock price of $471 implies a valuation ratio of 20x forward P/E. Check out our free in-depth research report to learn more about why TMO doesn’t pass our bar.

Comerica (CMA)

One-Month Return: +10.9%

Founded in 1849 during the California Gold Rush era, Comerica (NYSE: CMA) is a financial services company that provides commercial banking, retail banking, and wealth management services to businesses and individuals.

Why Does CMA Worry Us?

1. Net interest income trends were unexciting over the last five years as its 3.2% annual growth was below the typical bank company
2. Sales were less profitable over the last two years as its earnings per share fell by 26.9% annually, worse than its revenue declines
3. Tangible book value per share was flat over the last five years, indicating it’s failed to build equity value this cycle

At $67.57 per share, Comerica trades at 1.3x forward P/B. Dive into our free research report to see why there are better opportunities than CMA.

High-Quality Stocks for All Market Conditions

Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.

The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check 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.

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