The stocks featured in this article are seeing some big returns. Over the past month, they’ve outpaced the market due to some combination of positive news, upbeat results, or supportive macro developments. As such, investors are taking notice and bidding up shares.
But not every company with momentum is a long-term winner, and plenty of investors have lost money betting on short-term fads. All that said, here is one stock with the fundamentals to back up its performance and two not so much.
Two Momentum Stocks to Sell:
Kulicke and Soffa (KLIC)
One-Month Return: +30%
Headquartered in Singapore, Kulicke & Soffa (NASDAQ: KLIC) is a provider of production equipment and tools used to assemble semiconductor devices
Why Do We Pass on KLIC?
- Annual sales declines of 1.6% for the past five years show its products and services struggled to connect with the market during this cycle
- Overall productivity fell over the last five years as its plummeting sales were accompanied by a decline in its operating margin
- Earnings per share decreased by more than its revenue over the last five years, showing each sale was less profitable
Kulicke and Soffa’s stock price of $72.04 implies a valuation ratio of 25.6x forward P/E. To fully understand why you should be careful with KLIC, check out our full research report (it’s free).
CTS (CTS)
One-Month Return: +21.3%
With roots dating back to 1896 and a global manufacturing footprint, CTS (NYSE:CTS) designs and manufactures sensors, connectivity components, and actuators for aerospace, defense, industrial, medical, and transportation markets.
Why Is CTS Not Exciting?
- Products and services are facing end-market challenges during this cycle, as seen in its flat sales over the last two years
- Flat earnings per share over the last two years lagged its peers
- Diminishing returns on capital suggest its earlier profit pools are drying up
At $56.94 per share, CTS trades at 23.7x forward P/E. Check out our free in-depth research report to learn more about why CTS doesn’t pass our bar.
One Momentum Stock to Buy:
Planet Labs (PL)
One-Month Return: -16.1%
Pioneering the concept of "agile aerospace" with hundreds of small but powerful satellites, Planet Labs (NYSE:PL) operates the world's largest fleet of Earth observation satellites, capturing daily images of our planet to provide insights on deforestation, agriculture, and climate change.
Why Are We Bullish on PL?
- Sales pipeline is in good shape as its backlog averaged 177% growth over the past two years
- Free cash flow turned positive over the last five years, indicating the company has passed a significant test
- Historical investments are beginning to pay off as its returns on capital are growing
Planet Labs is trading at $21.25 per share, or 714.7x forward EV-to-EBITDA. Is now a good time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.
The names generating the next wave of massive growth are right here 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-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.