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. On that note, here is one stock we think lives up to the hype and two best left ignored.
Two momentum stocks to sell:
FactSet (FDS)
One-month return: +24.4%
Founded in 1978 when financial data was still primarily delivered through paper reports, FactSet (NYSE:FDS) provides financial data, analytics, and technology solutions that investment professionals use to research, analyze, and manage their portfolios.
Why Are We Wary of FDS?
- Muted 6% annual revenue growth over the last two years shows its demand lagged behind its financials peers
- Incremental sales over the last two years were less profitable as its 4.7% annual earnings per share growth lagged its revenue gains
At $343.93 per share, FactSet trades at 16.8x forward P/E. To fully understand why you should be careful with FDS, check out our full research report (it’s free).
CME Group (CME)
One-month return: +13.7%
Born from the Chicago Mercantile Exchange founded in 1898 as a butter and egg trading venue, CME Group (NASDAQ:CME) operates the world's largest derivatives marketplace where traders can buy and sell futures and options contracts across interest rates, equities, currencies, commodities, and more.
Why Is CME Not Exciting?
- Muted 7.4% annual revenue growth over the last two years shows its demand lagged behind its financials peers
- Earnings growth over the last two years fell short of the peer group average as its EPS only increased by 9.6% annually
CME Group’s stock price of $307.03 implies a valuation ratio of 23.4x forward P/E. Check out our free in-depth research report to learn more about why CME doesn’t pass our bar.
One momentum stock to buy:
Allegion (ALLE)
One-month return: +25.5%
Allegion plc (NYSE:ALLE) is a provider of security products and solutions that keep people and assets safe and secure in various environments.
What Makes ALLE Stand Out?
- Healthy operating margin of 20.1% shows it’s a well-run company with efficient processes, and it turbocharged its profits by achieving some fixed cost leverage
- Strong free cash flow margin of 15.1% enables it to reinvest or return capital consistently, and its rising cash conversion increases its margin of safety
- Industry-leading 21.4% return on capital demonstrates management’s skill in finding high-return investments
Allegion is trading at $192.93 per share, or 18.7x 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 is 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% between October 2022 and February 2026. AppLovin before it ran 753% between February 2024 and February 2026. Nvidia before it ran 1,178% between January 2023 and February 2026. 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 (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.