The stocks in this article are all trading near their 52-week highs. This strength often reflects positive developments such as new product launches, favorable industry trends, or improved financial performance.
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 is one stock with the fundamentals to back up its performance and two not so much.
Two Industrials Stocks to Sell:
A. O. Smith (AOS)
One-Month Return: +6.9%
Credited with the invention of the glass-lined water heater, A.O. Smith (NYSE:AOS) manufactures water heating and treatment products for various industries.
Why Is AOS Not Exciting?
- Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
- Earnings growth underperformed the sector average over the last two years as its EPS grew by just 1.3% annually
- Waning returns on capital imply its previous profit engines are losing steam
At $72.45 per share, A. O. Smith trades at 18.2x forward P/E. Dive into our free research report to see why there are better opportunities than AOS.
Winnebago (WGO)
One-Month Return: +11.4%
Created to provide high-quality, affordable RVs to the post-war American family, Winnebago (NYSE:WGO) is a manufacturer of recreational vehicles, providing a range of motorhomes, travel trailers, and fifth-wheel products for outdoor and adventure lifestyles.
Why Do We Avoid WGO?
- Sales tumbled by 6.7% annually over the last two years, showing market trends are working against its favor during this cycle
- Earnings per share fell by 10.1% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
- Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability
Winnebago’s stock price of $46.61 implies a valuation ratio of 19x forward P/E. Check out our free in-depth research report to learn more about why WGO doesn’t pass our bar.
One Industrials Stock to Buy:
Bloom Energy (BE)
One-Month Return: +59.7%
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 Is BE a Top Pick?
- Annual revenue growth of 19.1% over the last five years was superb and indicates its market share increased during this cycle
- Free cash flow profile has moved into positive territory over the last five years, showing the company is at an important crossroads
- Improving returns on capital suggest its past investments are beginning to deliver value
Bloom Energy is trading at $144.05 per share, or 168.9x forward P/E. Is now the time to initiate a position? See for yourself 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 Strong Momentum 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-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.