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.

But not every company with momentum is a long-term winner, and plenty of investors have lost money betting on short-term fads. All that said, here are two stocks with the fundamentals to back up their performance and one not so much.

One Momentum Stock to Sell:

Agilysys (AGYS)

One-Month Return: +45%

Originally a subsidiary of Pioneer-Standard Electronics that distributed electronic components, Agilysys (NASDAQ: AGYS) offers a software-as-service platform that helps hotels, resorts, restaurants, and other hospitality businesses manage their operations and workflows.

Why Are We Wary of AGYS?

1. Revenue increased by 19.2% annually over the last three years, acceptable on an absolute basis but tepid for a software company enjoying secular tailwinds
2. Gross margin of 62.4% is below its competitors, leaving less money to invest in areas like marketing and R&D
3. Capital intensity will likely increase as its free cash flow margin is anticipated to drop by 1.1 percentage points over the next year

Agilysys’s stock price of $102 implies a valuation ratio of 9.4x forward price-to-sales. If you’re considering AGYS for your portfolio, see our FREE research report to learn more.

Two Momentum Stocks to Buy:

Meta (META)

One-Month Return: +22.4%

Famously founded by Mark Zuckerberg in his Harvard dorm, Meta Platforms (NASDAQ: META) operates a collection of the largest social networks in the world - Facebook, Instagram, WhatsApp, and Messenger, along with its metaverse focused Reality Labs.

Why Is META a Good Business?

1. 13.3% annual increases in its average revenue per user over the last two years show its platform is resonating with power users
2. Disciplined cost controls and effective management resulted in a strong two-year EBITDA margin of 59.9%, and its operating leverage amplified its profits over the last few years
3. Robust free cash flow margin of 31.5% gives it many options for capital deployment

At $636.57 per share, Meta trades at 14.4x forward EV/EBITDA. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.

EMCOR (EME)

One-Month Return: +19.3%

Through its network of over 70 subsidiaries, EMCOR (NYSE: EME) provides electrical, mechanical, and building construction and services

Why Are We Backing EME?

1. Annual revenue growth of 14.8% over the last two years was superb and indicates its market share increased during this cycle
2. Performance over the past two years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
3. Improving returns on capital reflect management’s ability to monetize investments

EMCOR is trading at $458.32 per share, or 19.6x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.

Stocks We Like Even More

Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.

While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years.

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 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 for free.