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.
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 two stocks with lasting competitive advantages and one best left ignored.
One-Month Return: +7.6%
Rebranded from Conseco in 2010 to signal a fresh start after navigating financial challenges, CNO Financial Group (NYSE:CNO) develops and markets health insurance, annuities, and life insurance products primarily targeting middle-income pre-retirees and retirees.
Why Do We Steer Clear of CNO?
Stagnant net premiums earned over the last five years suggest the firm needs alternative growth strategies
Expenses have increased as a percentage of revenue over the last two years as its pre-tax profit margin fell by 2.3 percentage points
Book value per share tumbled by 7.2% annually over the last five years, showing insurance sector trends are working against its favor during this cycle
CNO Financial Group is trading at $43.61 per share, or 1.4x forward P/B. Dive into our free research report to see why there are better opportunities than CNO.
One-Month Return: +10.9%
Started by Stanford students Larry Page and Sergey Brin in a Menlo Park garage, Alphabet (NASDAQ:GOOGL) is the parent company of the eponymous Google Search engine, Google Cloud Platform, and YouTube.
Why Should You Buy GOOGL?
Alphabet’s dominant Google Search sits on the pantheon of the best businesses ever. This is reflected in its robust long-term revenue growth and elite operating margin.
The company’s profit margins have become even higher over time, speaking to its scale advantages and operating efficiency not only in its core Search business but also in Google Cloud Platform and YouTube.
Revenue growth and increasing operating margins are the key ingredients for strong EPS growth. Google has these, and when also factoring in its share repurchases, you can see why EPS has exploded over the long term.
Alphabet’s stock price of $335.05 implies a valuation ratio of 29.3x forward price-to-earnings. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
One-Month Return: +10.2%
With a Guinness World Record for engineering the largest spherical plain bearing, RBC Bearings (NYSE:RBC) is a manufacturer of bearings and related components for the aerospace & defense, industrial, and transportation industries.
