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.
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 is one stock with lasting competitive advantages and two that may correct.
Two Stocks to Sell:
Sensata Technologies (ST)
One-Month Return: +15.2%
Originally a temperature sensor control maker and a subsidiary of Texas Instruments for 60 years, Sensata Technology Holdings (NYSE: ST) is a leading supplier of analog sensors used in industrial and transportation applications, best known for its dominant position in the tire pressure monitoring systems in cars.
Why Do We Avoid ST?
- Annual sales declines of 4.2% for the past two years show its products and services struggled to connect with the market during this cycle
- Anticipated sales growth of 4.2% for the next year implies demand will be shaky
- Gross margin of 29.2% is below its competitors, leaving less money to invest in areas like marketing and R&D
Sensata Technologies is trading at $44.93 per share, or 11.7x forward P/E. Dive into our free research report to see why there are better opportunities than ST.
Tennant (TNC)
One-Month Return: +9.7%
As the world’s largest manufacturer of autonomous mobile robots, Tennant (NYSE: TNC) designs, manufactures, and sells cleaning products to various sectors.
Why Should You Dump TNC?
- Sales tumbled by 1.5% annually over the last two years, showing market trends are working against its favor during this cycle
- Performance over the past two years shows each sale was less profitable as its earnings per share dropped by 23.9% annually, worse than its revenue
- Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability
Tennant’s stock price of $87.12 implies a valuation ratio of 15.2x forward P/E. To fully understand why you should be careful with TNC, check out our full research report (it’s free).
One Stock to Watch:
Magnolia Oil & Gas (MGY)
One-Month Return: -6.4%
Operating over 600,000 net acres primarily in two distinct South Texas regions, Magnolia Oil & Gas (NYSE: MGY) drills and produces oil, natural gas, and natural gas liquids from South Texas formations.
Why Could MGY Be a Winner?
- Annual revenue growth of 18.7% over the last five years was superb and indicates its market share increased during this cycle
- Attractive asset base leads to wonderful unit economics and a best-in-class gross margin of 84.6%
- MGY is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
At $27.80 per share, Magnolia Oil & Gas trades at 9.8x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies.
Our AI system flagged Palantir before it ran 1,662%. AppLovin before it ran 753%. Nvidia before it ran 1,178%. Each week it produces 6 new names that pass the same tests. Get Our Top 6 Stocks for Free HERE.
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.
