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.
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 three stocks that are likely overheated and some you should look into instead.
Angi (ANGI)
One-Month Return: +36.3%
Created by IAC’s mergers of Angie’s List and HomeAdvisor, ANGI (NASDAQ: ANGI) operates the largest online marketplace for home services in the US.
Why Are We Wary of ANGI?
- Intense competition is diverting traffic from its platform as its service requests fell by 24.1% annually
- Forecasted revenue decline of 9.5% for the upcoming 12 months implies demand will fall even further
- Expensive marketing campaigns hurt its profitability and make us wonder what would happen if it let up on the gas
Angi’s stock price of $16.55 implies a valuation ratio of 5.3x forward EV/EBITDA. Read our free research report to see why you should think twice about including ANGI in your portfolio.
MarineMax (HZO)
One-Month Return: +10.1%
Appropriately headquartered in Clearwater, Florida, MarineMax (NYSE: HZO) sells boats, yachts, and other marine products.
Why Does HZO Fall Short?
- Ongoing store closures and lackluster same-store sales indicate sluggish demand and a focus on consolidation
- Poor same-store sales performance over the past two years indicates it’s having trouble bringing new shoppers into its brick-and-mortar locations
- Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution
At $21.45 per share, MarineMax trades at 8.2x forward P/E. Check out our free in-depth research report to learn more about why HZO doesn’t pass our bar.
Travel + Leisure (TNL)
One-Month Return: +12.9%
Formerly known as Wyndham Destinations, Travel + Leisure (NYSE: TNL) is a global vacation company that provides travelers with vacation ownership, exchange, and travel services.
Why Do We Think Twice About TNL?
- Performance surrounding its tours conducted has lagged its peers
- Anticipated sales growth of 2.8% for the next year implies demand will be shaky
- High net-debt-to-EBITDA ratio of 8× could force the company to raise capital at unfavorable terms if market conditions deteriorate
Travel + Leisure is trading at $48.15 per share, or 7.3x forward P/E. Dive into our free research report to see why there are better opportunities than TNL.
Stocks We Like 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 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 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-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free.
