Great things are happening to the stocks in this article. They’re all outperforming the market over the last month because of positive catalysts such as a new product line, constructive news flow, or even a loyal Reddit fanbase.
While momentum can be a leading indicator, it has burned many investors as it doesn’t always correlate with long-term success. Keeping that in mind, here is one stock with lasting competitive advantages and two not so much.
Two Momentum Stocks to Sell:
Magnachip (MX)
One-Month Return: +11.8%
With its technology found in common consumer electronics such as TVs and smartphones, Magnachip Semiconductor (NYSE: MX) is a provider of analog and mixed-signal semiconductors.
Why Is MX Risky?
- Sales tumbled by 18.5% annually over the last five years, showing market trends are working against its favor during this cycle
- Competitive supply chain dynamics and steep production costs are reflected in its low gross margin of 19.3%
- Cash burn has widened over the last five years, making us question whether it can reliably generate shareholder value
Magnachip is trading at $4.25 per share, or 0.8x forward price-to-sales. If you’re considering MX for your portfolio, see our FREE research report to learn more.
Opendoor (OPEN)
One-Month Return: +421%
Founded by real estate guru Eric Wu, Opendoor (NASDAQ: OPEN) offers a technology-driven, convenient, and streamlined process to buy and sell homes.
Why Do We Steer Clear of OPEN?
- Sluggish trends in its homes purchased suggest customers aren’t adopting its solutions as quickly as the company hoped
- Cash-burning history makes us doubt the long-term viability of its business model
- Unfavorable liquidity position could lead to additional equity financing that dilutes shareholders
Opendoor’s stock price of $2.76 implies a valuation ratio of 0.4x forward price-to-sales. Read our free research report to see why you should think twice about including OPEN in your portfolio.
One Momentum Stock to Buy:
FirstSun Capital Bancorp (FSUN)
One-Month Return: +17%
Tracing its roots back to 1892 when it first opened its doors in Kansas, FirstSun Capital Bancorp (NASDAQ: FSUN) operates Sunflower Bank, providing commercial and consumer banking services to businesses and individuals across the Southwest region.
Why Is FSUN a Top Pick?
- Annual net interest income growth of 20.5% over the last four years was superb and indicates its market share increased during this cycle
- Differentiated product suite is reflected in its Strong performance of its loan book leads to a High-yielding loan book and low cost of funds lead to a top-tier net interest margin of 4.2%
- Annual tangible book value per share growth of 12.1% over the last five years was superb and indicates its capital strength increased during this cycle
At $39.67 per share, FirstSun Capital Bancorp trades at 1x forward P/B. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.
High-Quality Stocks for All Market Conditions
Trump’s April 2024 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking 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 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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