The stocks featured in this article have all approached their 52-week highs. When these price levels hit, it typically signals strong business execution, positive market sentiment, or significant industry tailwinds.
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 is one stock with lasting competitive advantages and two best left ignored.
Two Stocks to Sell:
Cummins (CMI)
One-Month Return: +11.3%
With more than half of the heavy-duty truck market using its engines at one point, Cummins (NYSE: CMI) offers engines and power systems.
Why Are We Wary of CMI?
- Annual sales growth of 2.3% over the last two years lagged behind its industrials peers as its large revenue base made it difficult to generate incremental demand
- Free cash flow margin shrank by 6.9 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive
- Eroding returns on capital suggest its historical profit centers are aging
Cummins is trading at $397.57 per share, or 19.3x forward P/E. Check out our free in-depth research report to learn more about why CMI doesn’t pass our bar.
Douglas Dynamics (PLOW)
One-Month Return: +10.9%
Once manufacturing snowplows designed for the iconic jeep vehicle precursor, Douglas Dynamics (NYSE: PLOW) offers snow and ice equipment for the roads and sidewalks.
Why Do We Steer Clear of PLOW?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 2.7% annually over the last two years
- Expenses have increased as a percentage of revenue over the last five years as its operating margin fell by 3.8 percentage points
- Free cash flow margin dropped by 4.2 percentage points over the last five years, implying the company became more capital intensive as competition picked up
At $32.61 per share, Douglas Dynamics trades at 15x forward P/E. Read our free research report to see why you should think twice about including PLOW in your portfolio.
One Stock to Buy:
Popular (BPOP)
One-Month Return: +3.3%
Founded in 1893 as the first bank in Puerto Rico to serve the working class, Popular (NASDAQ: BPOP) is a financial holding company that provides retail, mortgage, and commercial banking services primarily in Puerto Rico and the mainland United States.
Why Is BPOP a Good Business?
- Net interest margin grew by 19.7 basis points (100 basis points = 1 percentage point) over the last two years, giving the firm more chips to play with
- Performance over the past five years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
- Annual tangible book value per share growth of 22.5% over the past two years was outstanding, reflecting strong capital accumulation this cycle
Popular’s stock price of $119 implies a valuation ratio of 1.3x forward P/B. Is now the time to initiate a position? Find out in our full research report, it’s free.
Stocks We Like Even 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 9 Market-Beating Stocks. 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
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