1 Momentum Stock with Impressive Fundamentals and 2 We Brush Off
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.
While momentum can be a leading indicator, it has burned many investors as it doesn’t always correlate with long-term success. On that note, here is one stock with lasting competitive advantages and two not so much.
Two Stocks to Sell:
Crane (CR)
One-Month Return: +2.4%
Based in Connecticut, Crane (NYSE:CR) is a diversified manufacturer of engineered industrial products, including fluid handling, and aerospace technologies.
Why Are We Cautious About CR?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 5.2% annually over the last five years
- Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
- Issuance of new shares over the last two years caused its earnings per share growth of 2.4% to lag its revenue gains
At $183.84 per share, Crane trades at 30x forward P/E. If you’re considering CR for your portfolio, see our FREE research report to learn more.
Envista (NVST)
One-Month Return: +14.2%
Uniting more than 30 trusted brands including Nobel Biocare, Ormco, and DEXIS under one corporate umbrella, Envista Holdings (NYSE:NVST) is a global dental products company that provides equipment, consumables, and specialized technologies for dental professionals.
Why Do We Think NVST Will Underperform?
- Constant currency growth was below our standards over the past two years, suggesting it might need to invest in product improvements to get back on track
- Negative returns on capital show management lost money while trying to expand the business, and its shrinking returns suggest its past profit sources are losing steam
- Eroding returns on capital from an already low base indicate that management’s recent investments are destroying value
Envista is trading at $21.85 per share, or 17.8x forward P/E. Read our free research report to see why you should think twice about including NVST in your portfolio.
One Stock to Buy:
Lam Research (LRCX)
One-Month Return: +9.6%
Founded in 1980 by David Lam, the man who pioneered semiconductor etching technology, Lam Research (NASDAQ:LRCX) is one of the leading providers of wafer fabrication equipment used to make semiconductors.
Why Is LRCX a Top Pick?
- Annual revenue growth of 11.2% over the last two years was superb and indicates its market share increased during this cycle
- Free cash flow margin expanded by 9.4 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
- Stellar returns on capital showcase management’s ability to surface highly profitable business ventures
Lam Research’s stock price of $157.05 implies a valuation ratio of 33.1x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free for active Edge members.
High-Quality Stocks for All Market Conditions
The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
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-micro-cap company Tecnoglass (+1,754% 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.