Momentum investing is a strategy that capitalizes on the tendency of winning stocks to continue winning by identifying securities with strong relative price performance that consistently outpace their peers and broader market indices. Rather than simply chasing rising prices, this approach systematically targets stocks demonstrating sustained upward momentum backed by solid fundamentals and improving business metrics.
The strategy exploits several key market inefficiencies that create persistent price trends. Earnings surprises often trigger sustained price movements as the market gradually reassesses a company’s prospects, while concentrated institutional buying creates upward pressure that can persist for months. Perhaps most importantly, positive information about companies tends to spread gradually through the investment community rather than being immediately reflected in prices, creating extended periods of price appreciation as more investors discover and act on favorable developments.
Validea’s quantitative models go beyond simple momentum indicators by incorporating proven methodologies from successful legendary investors, creating a more nuanced screening process. These models simultaneously evaluate price momentum characteristics alongside improving fundamental metrics such as accelerating earnings growth, expanding profit margins, increasing return on equity, and strengthening cash flow generation. This dual focus helps identify companies experiencing genuine business improvement rather than temporary market enthusiasm, increasing the likelihood of sustainable momentum.
Discover how Validea’s models can help you identify high-quality, long-term investments, even in changing market conditions. Visit Validea.com to access in-depth stock analysis and tools designed to emulate proven investment principles. Take a Free Trial Today!
Here are the top momentum stocks for May of 2025.
| Ticker | Company Name | Price | Market Cap ($mil) | PE Ratio | Price/ Sales | Relative Strength | Momentum Percentile | Twelve Minus One Return | Fundamental Momentum Percentile | 6 Mo Rel Str |
|---|---|---|---|---|---|---|---|---|---|---|
| XYF | X FINANCIAL (ADR) | $17.62 | $744 | 3.7 | 0.8 | 97 | 2 | 199.2% | 8 | 95 |
| BBAR | BANCO BBVA ARGENTINA SA (ADR) | $21.28 | $4,406 | 14.0 | 1.9 | 94 | 4 | 94.2% | 5 | 86 |
| CALM | CAL-MAINE FOODS INC | $95.01 | $4,607 | 4.7 | 1.2 | 89 | 8 | 55.6% | 1 | 60 |
| GAMB | GAMBLING.COM GROUP LTD | $12.20 | $424 | 12.5 | 3.1 | 88 | 8 | 52.1% | 34 | 53 |
| IBEX | IBEX LTD | $28.84 | $386 | 12.7 | 0.7 | 92 | 8 | 50.9% | 30 | 87 |
| GGAL | GRUPO FINANCIERO GALICIA SA (ADR) | $62.33 | $8,325 | 6.6 | 1.0 | 93 | 5 | 87.4% | 3 | 77 |
| AGX | ARGAN INC | $196.97 | $2,686 | 32.3 | 3.1 | 96 | 4 | 97.9% | 79 | 85 |
| BJ | BJ’S WHOLESALE CLUB HOLDINGS INC | $115.97 | $15,314 | 27.0 | 0.7 | 86 | 10 | 42.9% | 22 | 84 |
| NWG | NATWEST GROUP PLC – ADR | $14.14 | $56,799 | 9.3 | 2.6 | 91 | 8 | 53.9% | 79 | 88 |
| HRTG | HERITAGE INSURANCE HOLDINGS INC | $22.94 | $711 | 9.1 | 0.9 | 95 | 3 | 126.3% | 79 | 93 |
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