Exciting developments are taking place for the stocks in this article. They’ve all surged ahead of the broader market over the last month as catalysts such as new products and positive media coverage have propelled their returns.
While momentum can be a leading indicator, it has burned many investors as it doesn’t always correlate with long-term success. All that said, here are two stocks with lasting competitive advantages and one best left ignored.
One Momentum Stock to Sell:
Bath and Body Works (BBWI)
One-Month Return: +4.1%
Spun off from L Brands in 2020, Bath & Body Works (NYSE: BBWI) is a personal care and home fragrance retailer where consumers can find specialty shower gels, scented candles for the home, and lotions.
Why Are We Cautious About BBWI?
- Poor same-store sales performance over the past two years indicates it’s having trouble bringing new shoppers into its brick-and-mortar locations
- Sales are projected to tank by 5.2% over the next 12 months as its demand continues evaporating
- Earnings per share have dipped by 5.3% annually over the past three years, which is concerning because stock prices follow EPS over the long term
At $19.77 per share, Bath and Body Works trades at 7.5x forward P/E. If you’re considering BBWI for your portfolio, see our FREE research report to learn more.
Two Momentum Stocks to Buy:
WisdomTree (WT)
One-Month Return: +12.8%
Originally founded as a financial media company before pivoting to ETF management in 2006, WisdomTree (NYSE: WT) is a financial services company that creates and manages exchange-traded funds (ETFs) and other investment products for individual and institutional investors.
Why Are We Backing WT?
- Annual revenue growth of 17.4% over the last two years was superb and indicates its market share increased during this cycle
- Performance over the past two years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 57.1% outpaced its revenue gains
- ROE punches in at 14.3%, illustrating management’s expertise in identifying profitable investments
WisdomTree’s stock price of $12.40 implies a valuation ratio of 13.6x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free for active Edge members.
Enova (ENVA)
One-Month Return: +26.6%
Pioneering online lending since 2004 with a massive database of over 65 terabytes of customer behavior data, Enova International (NYSE: ENVA) provides online financial services including installment loans and lines of credit to non-prime consumers and small businesses in the United States and Brazil.
Why Will ENVA Beat the Market?
- Market share has increased this cycle as its 22.7% annual revenue growth over the last two years was exceptional
- Share buybacks catapulted its annual earnings per share growth to 34.1%, which outperformed its revenue gains over the last two years
- Balance sheet strength has increased this cycle as its 22% annual book value per share growth over the last five years was exceptional
Enova is trading at $164.80 per share, or 11.7x forward P/E. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free for active Edge members .
High-Quality Stocks for All Market Conditions
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
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 Exlservice (+354% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today.
