1 Surging Stock with Competitive Advantages and 2 We Find Risky

The stocks featured in this article have all approached their 52-week highs. When these price levels hit, it typically signals strong business execution, positive market sentiment, or significant industry tailwinds.

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 is one stock with the fundamentals to back up its performance and two that may correct.

Two Stocks to Sell:

AMN Healthcare Services (AMN)

One-Month Return: +43.6%

With a network of thousands of healthcare professionals ranging from nurses to physicians to executives, AMN Healthcare (NYSE:AMN) provides healthcare workforce solutions including temporary staffing, permanent placement, and technology platforms for hospitals and healthcare facilities across the United States.

Why Should You Sell AMN?

1. Declining travelers on assignment over the past two years indicate demand is soft and that the company may need to revise its strategy
2. Earnings per share have dipped by 7.1% annually over the past five years, which is concerning because stock prices follow EPS over the long term
3. Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability

At $29.37 per share, AMN Healthcare Services trades at 34x forward P/E. Dive into our free research report to see why there are better opportunities than AMN.

Flex (FLEX)

One-Month Return: +54.6%

Originally known as Flextronics until its 2016 rebranding, Flex (NASDAQ:FLEX) is a global manufacturing partner that designs, engineers, and builds products for companies across industries from medical devices to solar trackers.

Why Do We Think Twice About FLEX?

1. Large revenue base makes it harder to increase sales quickly, and its annual revenue growth of 2.8% over the last two years was below our standards for the business services sector
2. Low free cash flow margin of 2.8% for the last five years gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders

Flex’s stock price of $130.28 implies a valuation ratio of 31.1x forward P/E. To fully understand why you should be careful with FLEX, check out our full research report (it’s free).

One Stock to Watch:

AMETEK (AME)

One-Month Return: -4.7%

Started from its humble beginnings in motor repair, AMETEK (NYSE:AME) manufactures electronic devices used in industries like aerospace, power, and healthcare.

Why Are We Fans of AME?

1. Market share has increased this cycle as its 10.8% annual revenue growth over the last five years was exceptional
2. Healthy operating margin of 25.3% shows it’s a well-run company with efficient processes, and its rise over the last five years was fueled by some leverage on its fixed costs
3. AME is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders, and its rising cash conversion increases its margin of safety

AMETEK is trading at $225.72 per share, or 27.5x forward P/E. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.

High-Quality Stocks for All Market Conditions

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 meeting 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 (+1,326% 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.