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 lasting competitive advantages and one not so much.
One Momentum Stock to Sell:
Helios (HLIO)
One-Month Return: +22.1%
Founded on the principle of treating others as one wants to be treated, Helios (NYSE:HLIO) designs, manufactures, and sells motion and electronic control components for various sectors.
Why Do We Pass on HLIO?
- Organic sales performance over the past two years indicates the company may need to make strategic adjustments or rely on M&A to catalyze faster growth
- Performance over the past five years shows its incremental sales were less profitable as its earnings per share were flat
- Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
At $67.63 per share, Helios trades at 22.7x forward P/E. Check out our free in-depth research report to learn more about why HLIO doesn’t pass our bar.
Two Momentum Stocks to Watch:
Bloom Energy (BE)
One-Month Return: +64.9%
Working in stealth mode for eight years, Bloom Energy (NYSE:BE) designs, manufactures, and markets solid oxide fuel cell systems for on-site power generation.
Why Will BE Beat the Market?
- Market share has increased this cycle as its 19.1% annual revenue growth over the last five years was exceptional
- Free cash flow turned positive over the last five years, showing the company has crossed a key inflection point
- Improving returns on capital suggest its past investments are beginning to deliver value
Bloom Energy’s stock price of $152.17 implies a valuation ratio of 176x forward P/E. Is now a good time to buy? See for yourself in our full research report, it’s free.
Installed Building Products (IBP)
One-Month Return: +13%
Founded in 1977, Installed Building Products (NYSE:IBP) is a company specializing in the installation of insulation, waterproofing, and other complementary building products for residential and commercial construction.
Why Could IBP Be a Winner?
- Annual revenue growth of 13% over the last five years was superb and indicates its market share increased during this cycle
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 22.4% exceeded its revenue gains over the last five years
- Industry-leading 21.5% return on capital demonstrates management’s skill in finding high-return investments, and its returns are climbing as it finds even more attractive growth opportunities
Installed Building Products is trading at $300.50 per share, or 27.8x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check out 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-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.