1 Surging Stock to Consider Right Now and 2 We Turn Down

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. On that note, here is one stock with lasting competitive advantages and two that may correct.

Two Stocks to Sell:

Etsy (ETSY)

One-Month Return: +20.1%

Founded by a struggling amateur furniture maker Robert Kalin and his two friends, Etsy (NASDAQ:ETSY) is one of the world’s largest online marketplaces, focusing on handmade or vintage items.

Why Are We Cautious About ETSY?

1. Likely needs to improve its platform or increase its marketing budget for penetration to accelerate as its active buyers were flat over the last two years
2. Demand is forecasted to shrink as its estimated sales for the next 12 months are flat
3. Performance over the past three years shows its incremental sales were less profitable as its earnings per share were flat

Etsy is trading at $69.90 per share, or 11.6x forward EV/EBITDA. If you’re considering ETSY for your portfolio, see our FREE research report to learn more.

Telephone and Data Systems (TDS)

One-Month Return: +1.6%

Operating primarily through its majority-owned subsidiary UScellular and wholly-owned TDS Telecom, Telephone and Data Systems (NYSE:TDS) provides wireless, broadband, video, and voice communications services to 4.6 million wireless and 1.2 million broadband customers across the United States.

Why Is TDS Risky?

1. Annual sales declines of 1.5% for the past five years show its products and services struggled to connect with the market during this cycle
2. Falling earnings per share over the last five years has some investors worried as stock prices ultimately follow EPS over the long term
3. High net-debt-to-EBITDA ratio of 20× increases the risk of forced asset sales or dilutive financing if operational performance weakens

Telephone and Data Systems’s stock price of $39 implies a valuation ratio of 3.8x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than TDS.

One Stock to Watch:

Travelers (TRV)

One-Month Return: +3%

Tracing its roots back to 1853 when it insured travelers against accidents on steamboats and railroads, Travelers (NYSE:TRV) provides a wide range of commercial and personal property and casualty insurance products to businesses, government units, associations, and individuals.

Why Are We Positive On TRV?

1. 10.3% annualized net premiums earned expansion over the last two years exceeded the sector average as its policies appealed to customers
2. Additional sales over the last two years increased its profitability as the 52.8% annual growth in its earnings per share outpaced its revenue
3. Capital generation for the next 12 months is expected to accelerate above its two-year trend as Wall Street forecasts robust book value per share growth of 24.2%

At $282.73 per share, Travelers trades at 2.1x forward P/B. Is now the right time to buy? Find out in our full research report, it’s free for active Edge members.

High-Quality Stocks for All Market Conditions

When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.

Don’t let fear keep you from great opportunities and take a look at 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 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today

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