1 Surging Stock with Promising Prospects and 2 Facing Headwinds

Exciting developments are taking place for the stocks in this article. They’ve all surged ahead of the broader market over the last month as catalysts such as new products and positive media coverage have propelled their returns.

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 is one stock with lasting competitive advantages and two best left ignored.

Two Momentum Stocks to Sell:

Kura Sushi (KRUS)

One-Month Return: -5.3%

Known for its conveyor belt that transports dishes to diners, Kura Sushi (NASDAQ:KRUS) is a chain of sushi restaurants serving traditional Japanese fare with a touch of modernity and technology.

Why Are We Wary of KRUS?

1. Lagging same-store sales over the past two years suggest it might have to change its pricing and marketing strategy to stimulate demand
2. Cash-burning tendencies make us wonder if it can sustainably generate shareholder value
3. Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution

Kura Sushi is trading at $69.83 per share, or 40.4x forward EV-to-EBITDA. Read our free research report to see why you should think twice about including KRUS in your portfolio.

Silgan Holdings (SLGN)

One-Month Return: +14.7%

Established in 1987, Silgan Holdings (NYSE:SLGN) is a supplier of rigid packaging for consumer goods products, specializing in metal containers, closures, and plastic packaging.

Why Do We Think SLGN Will Underperform?

1. Muted 4.1% annual revenue growth over the last two years shows its demand lagged behind its industrials peers
2. Anticipated sales growth of 2.6% for the next year implies demand will be shaky
3. High input costs result in an inferior gross margin of 16.8% that must be offset through higher volumes

Silgan Holdings’s stock price of $48.24 implies a valuation ratio of 12.8x forward P/E. Check out our free in-depth research report to learn more about why SLGN doesn’t pass our bar.

One Momentum Stock to Watch:

Gorman-Rupp (GRC)

One-Month Return: +29.4%

Powering fluid dynamics since 1934, Gorman-Rupp (NYSE:GRC) has evolved from its Ohio origins into a global manufacturer and seller of pumps and pump systems.

Why Are We Positive On GRC?

1. Impressive 14.4% annual revenue growth over the last five years indicates it’s winning market share this cycle
2. Average backlog growth of 12.7% over the past two years shows it has a steady sales pipeline that will drive future orders
3. Incremental sales over the last two years have been highly profitable as its earnings per share increased by 25.1% annually, topping its revenue gains

At $66.81 per share, Gorman-Rupp trades at 29.1x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.

Stocks We Like Even More

Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.

The names generating the next wave of massive growth are right here in our Top 6 Stocks for this week. 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.