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.
While momentum can be a leading indicator, it has burned many investors as it doesn’t always correlate with long-term success. Keeping that in mind, here is one stock we think lives up to the hype and two best left ignored.
Two Stocks to Sell:
Aflac (AFL)
One-Month Return: -0.8%
Known for its iconic duck mascot that has quacked "Aflac!" in commercials since 2000, Aflac (NYSE: AFL) provides supplemental health and life insurance policies that pay cash benefits directly to policyholders for expenses not covered by their primary insurance.
Why Are We Cautious About AFL?
- 6.2% annual declines in net premiums earned for the past five years indicates policy sales struggled this cycle
- Earnings growth over the last two years fell short of the peer group average as its EPS only increased by 9.4% annually
- Book value per share is projected to remain flat over the next 12 months as profitability decelerates from its two-year trend
At $111.41 per share, Aflac trades at 2x forward P/B. Check out our free in-depth research report to learn more about why AFL doesn’t pass our bar.
Essent Group (ESNT)
One-Month Return: +8.4%
Serving as a crucial bridge between homebuyers and the American dream of homeownership, Essent Group (NYSE: ESNT) provides private mortgage insurance and title services that enable lenders to offer home loans with down payments of less than 20%.
Why Is ESNT Not Exciting?
- Sluggish 3.1% annualized growth in net premiums earned over the last five years indicates the firm trailed its insurance peers
- Day-to-day expenses have swelled relative to revenue over the last two years as its pre-tax profit margin fell by 10.2 percentage points
- Incremental sales over the last two years were less profitable as its 5% annual earnings per share growth lagged its revenue gains
Essent Group’s stock price of $65.25 implies a valuation ratio of 1.1x forward P/B. If you’re considering ESNT for your portfolio, see our FREE research report to learn more.
One Stock to Watch:
Urban Outfitters (URBN)
One-Month Return: +34.5%
Founded as a purveyor of vintage items, Urban Outfitters (NASDAQ: URBN) now largely sells new apparel and accessories to teens and young adults seeking on-trend fashion.
Why Are We Fans of URBN?
- Brick-and-mortar locations are witnessing elevated demand as their same-store sales growth averaged 4.6% over the past two years
- Forecasted revenue growth of 8.2% for the next 12 months suggests stronger momentum versus most peers
- Share repurchases have increased shareholder returns as its annual earnings per share growth of 41.8% exceeded its revenue gains over the last three years
Urban Outfitters is trading at $82.17 per share, or 14.6x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free for active Edge members.
Stocks We Like Even More
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 Growth Stocks for this month. 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 Comfort Systems (+782% 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.
