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.
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 with the fundamentals to back up their performance and one that may correct.
One stock to sell:
Packaging Corporation of America (PKG)
One-Month Return: +5.4%
Founded in 1959, Packaging Corporation of America (NYSE: PKG) produces containerboard and corrugated packaging products as well as displays and package protection.
Why Are We Wary of PKG?
- Annual revenue growth of 5.8% over the last five years was below our standards for the industrials sector
- Day-to-day expenses have swelled relative to revenue over the last five years as its operating margin fell by 6.3 percentage points
- Diminishing returns on capital suggest its earlier profit pools are drying up
Packaging Corporation of America’s stock price of $247.29 implies a valuation ratio of 18.4x forward P/E. Read our free research report to see why you should think twice about including PKG in your portfolio.
Two stocks to watch:
UnitedHealth (UNH)
One-Month Return: +10.7%
With over 100 million people served across its various businesses and a workforce of more than 400,000, UnitedHealth Group (NYSE:UNH) operates a health insurance business and Optum, a healthcare services division that provides everything from pharmacy benefits to primary care.
Why Could UNH Be a Winner?
- Decent 10% annual revenue growth over the last five years beat most of its peers, showing customers find value in its products and services
- Unparalleled scale of $449.7 billion in revenue enables it to spread administrative costs across a larger membership base
- Stellar returns on capital showcase management’s ability to surface highly profitable business ventures
UnitedHealth is trading at $418.20 per share, or 18.7x forward P/E. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.
Nicolet Bankshares (NIC)
One-Month Return: +4.2%
Starting as Green Bay Financial Corporation in 2000 before rebranding in 2002, Nicolet Bankshares (NYSE:NIC) is a regional bank holding company that provides commercial, agricultural, and consumer banking services primarily in Wisconsin, Michigan, and Minnesota.
Why Will NIC Beat the Market?
- Impressive 27.9% annual net interest income growth over the last five years indicates it’s winning market share this cycle
- Notable projected net interest income growth of 22.3% for the next 12 months hints at market share gains
- Net interest margin grew by 68.3 basis points (100 basis points = 1 percentage point) over the last two years, giving the firm more chips to play with
At $173.73 per share, Nicolet Bankshares trades at 1.5x forward P/B. Is now a good time to buy? Find out in our full research report, it’s free.
Stocks we like even more
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time.
Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.
