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1 Momentum Stock with Impressive Fundamentals and 2 Facing Challenges

CVS Cover Image

Each stock in this article is trading near its 52-week high. These elevated prices usually indicate some degree of investor confidence, business improvements, or favorable market conditions.

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 the fundamentals to back up its performance and two best left ignored.

Two Stocks to Sell:

CVS Health (CVS)

One-Month Return: +1.3%

With over 9,000 retail pharmacy locations serving as neighborhood health destinations across America, CVS Health (NYSE: CVS) operates retail pharmacies, provides pharmacy benefit management services, and offers health insurance through its Aetna subsidiary.

Why Are We Hesitant About CVS?

  1. Annual sales growth of 6.4% over the last two years lagged behind its healthcare peers as its large revenue base made it difficult to generate incremental demand
  2. Incremental sales over the last five years were much less profitable as its earnings per share fell by 2.9% annually while its revenue grew
  3. Underwhelming 5.3% return on capital reflects management’s difficulties in finding profitable growth opportunities, and its shrinking returns suggest its past profit sources are losing steam

CVS Health’s stock price of $80.43 implies a valuation ratio of 11.7x forward P/E. Check out our free in-depth research report to learn more about why CVS doesn’t pass our bar.

F.N.B. Corporation (FNB)

One-Month Return: +0.4%

Tracing its roots back to 1864 during the Civil War era, F.N.B. Corporation (NYSE: FNB) is a diversified financial services holding company that provides banking, wealth management, and insurance services to consumers and businesses across seven states and Washington, D.C.

Why Does FNB Worry Us?

  1. Muted 1.9% annual revenue growth over the last two years shows its demand lagged behind its banking peers
  2. Muted 8.1% annual net interest income growth over the last five years shows its demand lagged behind its banking peers
  3. Performance over the past two years shows its incremental sales were much less profitable, as its earnings per share fell by 5% annually

F.N.B. Corporation is trading at $17.59 per share, or 0.9x forward P/B. If you’re considering FNB for your portfolio, see our FREE research report to learn more.

One Stock to Buy:

Moody's (MCO)

One-Month Return: +9.3%

Founded in 1900 during America's railroad boom when investors needed reliable information on bond risks, Moody's (NYSE: MCO) provides credit ratings, risk assessment tools, and analytical solutions that help organizations evaluate financial risks and make informed investment decisions.

Why Do We Love MCO?

  1. Offerings and unique value proposition resonate with customers, as seen in its above-market 14.5% annual sales growth over the last two years
  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. Industry-leading 63.8% return on equity demonstrates management’s skill in finding high-return investments

At $531.87 per share, Moody's trades at 32.9x forward P/E. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.

Stocks We Like Even More

Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.

The names generating the next wave of massive growth are right here in 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.

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