Each stock in this article is trading near its 52-week high. These elevated prices usually indicate some degree of investor confidence, business improvements, or favorable market conditions.
However, not all companies with momentum are long-term winners, and many investors have lost money by following short-term trends. On that note, here are two stocks with the fundamentals to back up their performance and one best left ignored.
One Stock to Sell:
Scholastic (SCHL)
One-Month Return: -0.9%
Creator of the legendary Scholastic Book Fair, Scholastic (NASDAQ:SCHL) is an international company specializing in children's publishing, education, and media services.
Why Should You Dump SCHL?
- 4.9% annual revenue growth over the last five years was slower than its consumer discretionary peers
- Lacking free cash flow generation means it has few chances to reinvest for growth, repurchase shares, or distribute capital
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
At $34.08 per share, Scholastic trades at 23.7x forward P/E. Read our free research report to see why you should think twice about including SCHL in your portfolio.
Two Stocks to Buy:
Monolithic Power Systems (MPWR)
One-Month Return: +13.5%
Founded in 1997 by its longtime CEO Michael Hsing, Monolithic Power Systems (NASDAQ:MPWR) is an analog and mixed signal chipmaker that specializes in power management chips meant to minimize total energy consumption.
Why Will MPWR Beat the Market?
- Annual revenue growth of 27% over the past five years was outstanding, reflecting market share gains this cycle
- Free cash flow margin expanded by 8 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
Monolithic Power Systems is trading at $1,172 per share, or 53.8x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
McKesson (MCK)
One-Month Return: +11.2%
With roots dating back to 1833, making it one of America's oldest continuously operating businesses, McKesson (NYSE:MCK) is a healthcare services company that distributes pharmaceuticals, medical supplies, and provides technology solutions to pharmacies, hospitals, and healthcare providers.
Why Should You Buy MCK?
- 14.9% annual revenue growth over the last two years surpassed the sector average as its offerings resonated with customers
- Unparalleled scale of $398 billion in revenue gives it negotiating leverage and staying power in an industry with high barriers to entry
- Performance over the past five years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
McKesson’s stock price of $934.51 implies a valuation ratio of 21.2x forward P/E. Is now a good time to buy? See for yourself in our in-depth 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 6 Stocks for this week. 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 Exlservice (+354% five-year return). Find your next big winner with StockStory today.