2 Mooning Stocks on Our Buy List and 1 Facing Challenges

The stocks featured in this article are seeing some big returns. Over the past month, they’ve outpaced the market due to some combination of positive news, upbeat results, or supportive macro developments. As such, investors are taking notice and bidding up shares.

However, not all companies with momentum are long-term winners, and many investors have lost money by following short-term trends. On that note, here are two stocks we think live up to the hype and one best left ignored.

One Momentum Stock to Sell:

Figs (FIGS)

One-Month Return: +1.8%

Rising to fame via TikTok and founded in 2013 by Heather Hasson and Trina Spear, Figs (NYSE:FIGS) is a healthcare apparel company known for its stylish approach to medical attire and uniforms.

Why Is FIGS Risky?

1. Muted 19.1% annual revenue growth over the last five years shows its demand lagged behind its consumer discretionary peers
2. Falling earnings per share over the last four years has some investors worried as stock prices ultimately follow EPS over the long term
3. Free cash flow margin is not anticipated to grow over the next year

At $15.73 per share, Figs trades at 62.9x forward P/E. Check out our free in-depth research report to learn more about why FIGS doesn’t pass our bar.

Two Momentum Stocks to Buy:

Vita Coco (COCO)

One-Month Return: -10.7%

Founded in 2004 followed by a 2021 IPO, The Vita Coco Company (NASDAQ:COCO) offers coconut water products that are a natural way to quench thirst.

Why Will COCO Outperform?

1. Unit sales were phenomenal over the past two years, showing demand is robust and retailers can’t stock enough of its products
2. Earnings per share have massively outperformed its peers over the last three years, increasing by 70.9% annually
3. Industry-leading 36.9% return on capital demonstrates management’s skill in finding high-return investments, and its returns are climbing as it finds even more attractive growth opportunities

Vita Coco’s stock price of $51.85 implies a valuation ratio of 33.5x forward P/E. Is now a good time to buy? See for yourself in our full research report, it’s free.

Hims & Hers Health (HIMS)

One-Month Return: +44.1%

Originally launched with a focus on stigmatized conditions like hair loss and sexual health, Hims & Hers Health (NYSE:HIMS) operates a consumer-focused telehealth platform that connects patients with healthcare providers for prescriptions and wellness products.

Why Will HIMS Beat the Market?

1. Business is winning new contracts that can potentially increase in value as its customer base averaged 29.5% growth over the past two years
2. Free cash flow margin grew by 16.9 percentage points over the last five years, giving the company more chips to play with
3. Historical investments are beginning to pay off as its returns on capital are growing

Hims & Hers Health is trading at $20.93 per share, or 19x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.

High-Quality Stocks for All Market Conditions

WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.

But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE.

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.