1 Surging Stock on Our Buy List and 2 Facing Challenges

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.

However, not all companies with momentum are long-term winners, and many investors have lost money by following short-term trends. Keeping that in mind, here is one stock with lasting competitive advantages and two that may correct.

Two Momentum Stocks to Sell:

NXP Semiconductors (NXPI)

One-Month Return: +41.9%

Spun off from Dutch electronics giant Philips in 2006, NXP Semiconductors (NASDAQ: NXPI) is a designer and manufacturer of chips used in autos, industrial manufacturing, mobile devices, and communications infrastructure.

Why Do We Think Twice About NXPI?

1. Customers postponed purchases of its products and services this cycle as its revenue declined by 2.5% annually over the last two years
2. Anticipated sales growth of 14.6% for the next year implies demand will be shaky

NXP Semiconductors’s stock price of $297.83 implies a valuation ratio of 18.9x forward P/E. If you’re considering NXPI for your portfolio, see our FREE research report to learn more.

Illumina (ILMN)

One-Month Return: +12.2%

Pioneering the ability to read the human genome at unprecedented speed and affordability, Illumina (NASDAQ:ILMN) develops and sells advanced DNA sequencing and microarray technologies that allow researchers and clinicians to analyze genetic variations and functions.

Why Does ILMN Give Us Pause?

1. Sales stagnated over the last two years and signal the need for new growth strategies
2. Organic sales performance over the past two years indicates the company may need to make strategic adjustments or rely on M&A to catalyze faster growth
3. ROIC of 0.7% reflects management’s challenges in identifying attractive investment opportunities

At $146.25 per share, Illumina trades at 27.1x forward P/E. Read our free research report to see why you should think twice about including ILMN in your portfolio.

One Momentum Stock to Buy:

StoneX (SNEX)

One-Month Return: +13.5%

Originally known as INTL FCStone until its 2020 rebranding, StoneX Group (NASDAQ:SNEX) provides a global financial services network connecting companies, traders, and investors to markets through clearing, execution, and advisory services.

Why Are We Bullish on SNEX?

1. Market share has increased this cycle as its 44.3% annual revenue growth over the last two years was exceptional
2. Earnings growth has massively outpaced its peers over the last two years as its EPS has compounded at 29.6% annually
3. Impressive 16.9% annual tangible book value per share growth over the last five years indicates it’s building equity value this cycle

StoneX is trading at $116.05 per share, or 3.2x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.

Stocks We Like Even 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.

Find out which 5 stocks it's flagging for this month - FREE. Get Our Top 5 Growth 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-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.