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 are three stocks getting more buzz than they deserve and some you should buy instead.
EnerSys (ENS)
One-Month Return: +15.6%
Supplying batteries that power equipment as big as mining rigs, EnerSys (NYSE: ENS) manufactures various kinds of batteries for a range of industries.
Why Does ENS Give Us Pause?
- Flat unit sales over the past two years show it’s struggled to increase its sales volumes and had to rely on price increases
- Demand will likely be soft over the next 12 months as Wall Street’s estimates imply tepid growth of 2.3%
- Gross margin of 26.3% reflects its high production costs
At $190.07 per share, EnerSys trades at 16.9x forward P/E. Dive into our free research report to see why there are better opportunities than ENS.
Arrow Electronics (ARW)
One-Month Return: +22%
Founded as a single retail store, Arrow Electronics (NYSE: ARW) provides electronic components and enterprise computing solutions to businesses globally.
Why Is ARW Risky?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 3.5% annually over the last two years
- Sales were less profitable over the last two years as its earnings per share fell by 19.7% annually, worse than its revenue declines
- Diminishing returns on capital suggest its earlier profit pools are drying up
Arrow Electronics’s stock price of $171.92 implies a valuation ratio of 12.4x forward P/E. Read our free research report to see why you should think twice about including ARW in your portfolio.
Northwest Bancshares (NWBI)
One-Month Return: +9.2%
Founded in 1896 and operating across Pennsylvania, New York, Ohio, and Indiana, Northwest Bancshares (NASDAQ: NWBI) is a bank holding company that operates Northwest Bank, providing personal and business banking, investment management, and trust services.
Why Do We Think NWBI Will Underperform?
- Annual revenue growth of 4.4% over the last five years was below our standards for the banking sector
- 6% annual net interest income growth over the last five years was slower than its banking peers
- Capital trends were unexciting over the last two years as its 2.5% annual tangible book value per share growth was below the typical banking firm
Northwest Bancshares is trading at $13.25 per share, or 1x forward P/B. To fully understand why you should be careful with NWBI, check out our full research report (it’s free).
Stocks We Like More
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
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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.
