Each stock in this article is trading near its 52-week high. These elevated prices usually indicate some degree of investor confidence, business improvements, or favorable market conditions.
But not every company with momentum is a long-term winner, and plenty of investors have lost money betting on short-term fads. Keeping that in mind, here are three stocks getting more buzz than they deserve and some you should buy instead.
Teledyne (TDY)
One-Month Return: +1%
Playing a role in mapping the ocean floor as we know it today, Teledyne (NYSE: TDY) offers digital imaging and instrumentation products for various industries.
Why Are We Wary of TDY?
- 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
- Free cash flow margin shrank by 2.5 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive
- Below-average returns on capital indicate management struggled to find compelling investment opportunities
Teledyne’s stock price of $542.03 implies a valuation ratio of 24x forward P/E. Dive into our free research report to see why there are better opportunities than TDY.
Ryder (R)
One-Month Return: -0.3%
As one of the first companies to introduce the idea of leasing trucks, Ryder (NYSE: R) provides rental vehicles to businesses and delivers packages directly to homes or businesses.
Why Do We Steer Clear of R?
- Annual sales growth of 3% over the last two years lagged behind its industrials peers as its large revenue base made it difficult to generate incremental demand
- Earnings per share have dipped by 7.4% annually over the past two years, which is concerning because stock prices follow EPS over the long term
- Free cash flow margin dropped by 9.5 percentage points over the last five years, implying the company became more capital intensive as competition picked up
At $173.91 per share, Ryder trades at 12.3x forward P/E. Check out our free in-depth research report to learn more about why R doesn’t pass our bar.
MGIC Investment (MTG)
One-Month Return: +7%
Founded in 1957 when the modern mortgage insurance industry was in its infancy, MGIC Investment (NYSE: MTG) provides private mortgage insurance that protects lenders when homebuyers default on their loans, enabling borrowers to purchase homes with smaller down payments.
Why Is MTG Not Exciting?
- Insurance products are facing significant market challenges during this cycle as net premiums earned has declined by 1.3% annually over the last five years
- Day-to-day expenses have swelled relative to revenue over the last two years as its combined ratio increased by 10.7 percentage points
- Earnings per share lagged its peers over the last two years as they only grew by 6.1% annually
MGIC Investment is trading at $27.33 per share, or 1.2x forward P/B. If you’re considering MTG for your portfolio, see our FREE research report to learn more.
Stocks We Like More
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 6 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 Tecnoglass (+1,754% 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
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