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.
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 two stocks with the fundamentals to back up their performance and one not so much.
One Momentum Stock to Sell:
Norwegian Cruise Line (NCLH)
One-Month Return: +14.5%
With amenities like a full go-kart race track built into its ships, Norwegian Cruise Line (NYSE: NCLH) is a premier global cruise company.
Why Should You Dump NCLH?
- Performance surrounding its passenger cruise days has lagged its peers
- Negative free cash flow raises questions about the return timeline for its investments
- Limited cash reserves may force the company to seek unfavorable financing terms that could dilute shareholders
Norwegian Cruise Line’s stock price of $20.75 implies a valuation ratio of 14x forward P/E. To fully understand why you should be careful with NCLH, check out our full research report (it’s free).
Two Momentum Stocks to Watch:
Granite Construction (GVA)
One-Month Return: +9.6%
Having played a role in the construction of the Hoover Dam, Granite Construction (NYSE: GVA) is a provider of infrastructure solutions for roads, bridges, and other projects.
Why Are We Positive on GVA?
- Market share has increased this cycle as its 13.2% annual revenue growth over the last two years was exceptional
- Share repurchases over the last two years enabled its annual earnings per share growth of 37.4% to outpace its revenue gains
- Free cash flow margin grew by 11.5 percentage points over the last five years, giving the company more chips to play with
Granite Construction is trading at $149.85 per share, or 24x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Douglas Dynamics (PLOW)
One-Month Return: +15.6%
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 Like PLOW?
- Estimated revenue growth of 13.1% for the next 12 months implies demand will accelerate from its two-year trend
- Incremental sales significantly boosted profitability as its annual earnings per share growth of 41.4% over the last two years outstripped its revenue performance
- Free cash flow margin jumped by 9.4 percentage points over the last five years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
At $52.31 per share, Douglas Dynamics trades at 19.8x forward P/E. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
High-Quality Stocks for All Market Conditions
ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI is taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies.
Our AI system flagged Palantir before it ran 1,662%. AppLovin before it ran 753%. Nvidia before it ran 1,178%. Each week it produces 6 new names that pass the same tests. Get Our Top 6 Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 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.
