1 Soaring Stock Worth Holding for Years and 2 We Wonder

Recent Standouts in the Stock Market

Several stocks have recently outperformed the overall market, driven by factors like innovative product launches and favorable media attention. However, it's important to remember that not every stock experiencing a surge will deliver lasting gains—many investors have been caught out by fleeting trends. With that in mind, here’s a closer look at one stock with strong underlying fundamentals and two others that may be best avoided.

Two Momentum Stocks to Consider Selling

Victoria's Secret (VSCO)

One-Month Performance: +10.9%

Victoria’s Secret (NYSE:VSCO), which became independent from L Brands in 2020, is a well-known retailer specializing in its own lines of lingerie, intimate apparel, and fragrances.

Key Concerns with VSCO:

• Over the past three years, sales have only increased by 1.1% annually, lagging behind the typical growth seen in the retail sector.
• Inefficient cost management has resulted in an operating margin of just 4.5%, which is below the industry norm.
• Although revenue has grown, profitability has declined, with earnings per share dropping by an average of 16.2% each year over the same period.

Currently, Victoria's Secret trades at $49.97 per share, reflecting a forward price-to-earnings ratio of 14.5.

PVH (PVH)

One-Month Performance: +42.7%

PVH (NYSE:PVH), established in 1881, is a global fashion powerhouse behind renowned brands such as Calvin Klein and Tommy Hilfiger.

Why We’re Cautious About PVH:

• Revenue growth, when adjusted for currency fluctuations, has been lackluster over the past two years, suggesting that current product offerings may not be resonating with consumers.
• Projections indicate that the company’s free cash flow margin will remain stagnant in the coming year.
• Return on capital has shown little improvement, implying that management has struggled to generate additional value.

PVH shares are priced at $89.02, equating to a forward P/E of 7.4.

One Momentum Stock Worth Considering

Abercrombie & Fitch (ANF)

One-Month Performance: +10.1%

Originally launched as an outdoor and sporting goods brand, Abercrombie & Fitch (NYSE:ANF) has transformed into a specialty retailer catering to young adults with its own line of trendy apparel.

What Sets ANF Apart?

• Physical stores have experienced robust demand, with same-store sales rising by an average of 10% over the last two years.
• The company’s unique product selection has resulted in an impressive gross margin of 62.8%—among the best in its class.
• Ongoing share buybacks have boosted returns for shareholders, as annual earnings per share growth has outpaced revenue increases over the past three years.

Abercrombie & Fitch is currently valued at $93.58 per share, with a forward P/E ratio of 9.1. Is this the right moment to invest?

Even More Compelling Stocks

ALSO RECOMMENDED: Top 5 Momentum Stocks. The ideal time to own a standout stock is when the market begins to recognize its potential. These companies aren’t just fundamentally strong—they’re also experiencing significant momentum right now, checking both critical boxes.

Discover which stocks our AI-driven platform is highlighting this week. Access the latest list of Strong Momentum stocks—completely free.

Past picks from our list include well-known names like Nvidia (which soared 1,326% from June 2020 to June 2025) and lesser-known companies such as Exlservice, which delivered a 354% return over five years.