1 Momentum Stock for Long-Term Investors and 2 We Find Risky
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.
While momentum can be a leading indicator, it has burned many investors as it doesn’t always correlate with long-term success. On that note, here is one stock we think lives up to the hype and two best left ignored.
Two Momentum Stocks to Sell:
ZoomInfo (GTM)
One-Month Return: +23.4%
Operating a platform it calls "RevOS" - short for Revenue Operating System - ZoomInfo (NASDAQ:GTM) provides sales, marketing, and recruiting teams with business intelligence and analytics to identify prospects and deliver targeted outreach.
Why Do We Avoid GTM?
- Customers had second thoughts about committing to its platform over the last year as its billings plateaued
- Sales are projected to tank by 6.2% over the next 12 months as demand evaporates
- Efficiency has decreased over the last year as its operating margin fell by 49.7 percentage points
At $3.86 per share, ZoomInfo trades at 0.9x forward price-to-sales. If you’re considering GTM for your portfolio, see our FREE research report to learn more.
Azenta (AZTA)
One-Month Return: +25.8%
Serving as the guardian of some of medicine's most valuable materials, Azenta (NASDAQ:AZTA) provides biological sample management, storage, and genomic services that help pharmaceutical and biotechnology companies preserve and analyze critical research materials.
Why Do We Pass on AZTA?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 3.5% annually over the last two years
- Earnings per share have dipped by 28.6% annually over the past five years, which is concerning because stock prices follow EPS over the long term
- Negative free cash flow raises questions about the return timeline for its investments
Azenta’s stock price of $33.02 implies a valuation ratio of 58.2x forward P/E. To fully understand why you should be careful with AZTA, check out our full research report (it’s free).
One Momentum Stock to Watch:
Belden (BDC)
One-Month Return: +30.1%
With its enamel-coated copper wire used in WWI for the Allied forces, Belden (NYSE:BDC) designs, manufactures, and sells electronic components to various industries.
Why Do We Like BDC?
- Annual revenue growth of 11.2% over the last two years was superb and indicates its market share increased during this cycle
- Projected revenue growth of 34.6% for the next 12 months is above its two-year trend, pointing to accelerating demand
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 16.7% exceeded its revenue gains over the last two years
Belden is trading at $129.49 per share, or 14.9x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time.
Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.