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.
However, not all companies with momentum are long-term winners, and many investors have lost money by following short-term trends. On that note, here are two stocks with lasting competitive advantages and one best left ignored.
One Momentum Stock to Sell:
Intel (INTC)
One-Month Return: +17%
Inventor of the x86 processor that powered decades of technological innovation in PCs, data centers, and numerous other markets, Intel (NASDAQ: INTC) is a leading manufacturer of computer processors and graphics chips.
Why Are We Out on INTC?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 7.6% annually over the last five years
- Overall productivity fell over the last five years as its plummeting sales were accompanied by a decline in its operating margin
- Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 39.4 percentage points
Intel is trading at $28.73 per share, or 91.9x forward P/E. To fully understand why you should be careful with INTC, check out our full research report (it’s free).
Two Momentum Stocks to Buy:
Sterling (STRL)
One-Month Return: +28.8%
Involved in the construction of a major highway, the Grand Parkway in Houston, TX, Sterling Infrastructure (NASDAQ: STRL) provides civil infrastructure construction.
Why Will STRL Beat the Market?
- Annual revenue growth of 9.9% over the last five years beat the sector average and underscores the unique value of its offerings
- Free cash flow margin grew by 12.1 percentage points over the last five years, giving the company more chips to play with
- Returns on capital are climbing as management makes more lucrative bets
Sterling’s stock price of $368.99 implies a valuation ratio of 41.6x forward P/E. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.
ESCO (ESE)
One-Month Return: +10.4%
A developer of the communication systems used in the Batmobile of “The Dark Knight,” ESCO (NYSE: ESE) is a provider of engineered components for the aerospace, defense, and utility sectors.
Why Do We Love ESE?
- Market share is on track to rise over the next 12 months as its 23.1% projected revenue growth implies demand will accelerate from its two-year trend
- Superior product capabilities and pricing power lead to a premier gross margin of 39.1%
- Performance over the past two years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 22.4% outpaced its revenue gains
At $213.97 per share, ESCO trades at 32.4x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking 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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