Exciting developments are taking place for the stocks in this article. They’ve all surged ahead of the broader market over the last month as catalysts such as new products and positive media coverage have propelled their returns.
However, not all companies with momentum are long-term winners, and many investors have lost money by following short-term trends. Keeping that in mind, here is one stock with lasting competitive advantages and two that may correct.
Two Momentum Stocks to Sell:
Shake Shack (SHAK)
One-Month Return: +32.3%
Started as a hot dog cart in New York City's Madison Square Park, Shake Shack (NYSE: SHAK) is a fast-food restaurant known for its burgers and milkshakes.
Why Are We Hesitant About SHAK?
- Poor expense management has led to an operating margin of 0.6% that is below the industry average
- Poor free cash flow margin of 1.6% for the last two years limits its freedom to invest in growth initiatives, execute share buybacks, or pay dividends
- Negative returns on capital show that some of its growth strategies have backfired
Shake Shack is trading at $118.62 per share, or 88.5x forward P/E. Read our free research report to see why you should think twice about including SHAK in your portfolio.
PVH (PVH)
One-Month Return: +15.3%
Founded in 1881 by a husband and wife duo, PVH (NYSE: PVH) is a global fashion conglomerate with iconic brands like Calvin Klein and Tommy Hilfiger.
Why Should You Sell PVH?
- Constant currency revenue growth has disappointed over the past two years and shows demand was soft
- Demand will likely be weak over the next 12 months as Wall Street expects flat revenue
- Underwhelming 3.5% return on capital reflects management’s difficulties in finding profitable growth opportunities
PVH’s stock price of $81.99 implies a valuation ratio of 7.2x forward P/E. Check out our free in-depth research report to learn more about why PVH doesn’t pass our bar.
One Momentum Stock to Watch:
Intuit (INTU)
One-Month Return: +16.5%
Created in 1983 when founder Scott Cook watched his wife struggle to reconcile the family's checkbook, Intuit provides tax and accounting software for small and medium-sized businesses.
Why Are We Fans of INTU?
- Average billings growth of 15.8% over the last year enhances its liquidity and shows there is steady demand for its products
- Fast payback periods on sales and marketing expenses allow the company to invest heavily and onboard many customers concurrently
- Robust free cash flow margin of 33.6% gives it many options for capital deployment
At $720 per share, Intuit trades at 9.8x forward price-to-sales. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
Stocks We Like Even More
Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.
While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like 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 Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free.
