Great things are happening to the stocks in this article. They’re all outperforming the market over the last month because of positive catalysts such as a new product line, constructive news flow, or even a loyal Reddit fanbase.
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.
Opendoor (OPEN)
One-Month Return: +177%
Founded by real estate guru Eric Wu, Opendoor (NASDAQ: OPEN) offers a technology-driven, convenient, and streamlined process to buy and sell homes.
Why Do We Steer Clear of OPEN?
- Demand for its offerings was relatively low as its number of homes purchased has underwhelmed
- Cash-burning history makes us doubt the long-term viability of its business model
- Negative earnings profile makes it challenging to secure favorable financing terms from lenders
Opendoor is trading at $10.01 per share, or 2.1x forward price-to-sales. Dive into our free research report to see why there are better opportunities than OPEN.
Macy's (M)
One-Month Return: +34.9%
With a storied history that began with its 1858 founding, Macy’s (NYSE: M) is a department store chain that sells clothing, cosmetics, accessories, and home goods.
Why Should You Dump M?
- Store closures and disappointing same-store sales suggest demand is sluggish and it’s rightsizing its operations
- Poor same-store sales performance over the past two years indicates it’s having trouble bringing new shoppers into its brick-and-mortar locations
- Sales are expected to decline once again over the next 12 months as it continues working through a challenging demand environment
At $17.59 per share, Macy's trades at 9.7x forward P/E. Read our free research report to see why you should think twice about including M in your portfolio.
Clover Health (CLOV)
One-Month Return: +21.8%
Founded in 2014 to improve healthcare for America's seniors through technology, Clover Health (NASDAQ: CLOV) provides Medicare Advantage plans for seniors with a focus on affordable care and uses its proprietary Clover Assistant software to help physicians manage patient care.
Why Does CLOV Worry Us?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 18.1% annually over the last two years
- Smaller revenue base of $1.61 billion means it hasn’t achieved the economies of scale that some industry juggernauts enjoy
- Cash burn makes us question whether it can achieve sustainable long-term growth
Clover Health’s stock price of $3.07 implies a valuation ratio of 21.9x forward P/E. Check out our free in-depth research report to learn more about why CLOV doesn’t pass our bar.
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 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-small-cap company Comfort Systems (+782% 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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