In a recent CNBC appearance, Ritholtz Wealth Management co-founder and CEO, Josh Brown, noted that he begins every week by examining momentum stock data. Brown, whose investment advisory firm manages over $4 billion in assets, has been very successful. Retail investors could certainly profit a great deal by emulating his methods. While momentum stocks often lose momentum eventually, investors can protect themselves by setting up a stop-loss order or adopting dollar-cost averaging. For investors who want to try momentum investing, here are three momentum stocks to buy now.
SoundHound AI (SOUN)
SoundHound AI’s (NASDAQ:SOUN) shares jumped 236.22% in the last month. The company’s technology enables AI systems to directly understand human speech.
The big catalyst for SOUN’s surge was Nvidia’s (NASDAQ:NVDA) decision to purchase $3.7 million of SOUN stock last quarter. Additionally, many large firms, such as Oracle (NYSE:ORCL), Square (NYSE:SQ), Hyundai (OTCMKTS:HYMTF) and Stellantis (NYSE:STLA) are utilizing SOUN’s system.
SoundHound AI’s ability to attract such an impressive customer roster, along with the investment from Nvidia, certainly bodes well for the firm’s outlook. Despite its large price-sales ratio of 34 times, its recent strong performance makes it one of the most promising momentum stocks to buy.
Celsius (CELH)
Celsius’ (NASDAQ:CELH) shares have jumped 57.78% in the last month. Moreover, the shares were recently rising slightly above their 52-week high of $91.36.
Last quarter, Celsius’ top line soared 95% versus the same period a year earlier to a record $347 million, while its EBITDA, excluding certain items, jumped 387% year-over-year to about $65 million.
CEO John Fieldly attributed the firm’s growth to expanding availability of its products and increased consumer awareness.
In the wake of the results, investment bank Cowen stated that the firm maintained strong momentum.
However, the shares do have a very high forward price-earnings ratio of over 80 at this point.
Xpeng (XPEV)
Xpeng’s (NASDAQ:XPEV) shares have advanced 19.15% in the last month.
Morgan Stanley recently wrote that three Chinese electric-vehicle names, including Xpeng, could rebound meaningfully this year. The bank believes that any negative economic conditions are already baked into their stock prices.
Moreover, Morgan Stanley expects the firms to benefit from “green shoots” starting in the second quarter of this year. The bank kept an “overweight” rating on XPEV stock, and it expects the firm’s sales growth to increase in Q2, driven by its new models. Morgan Stanley has an $18 price target on the shares.
Also noteworthy is that Xpeng could benefit over the longer term from its deal, announced on February 29, to launch two B-class battery EVs in partnership with Volkswagen (OTCmkts:VWAGY). Moreover, the two firms agreed to jointly buy parts, which should meaningfully lower production costs.
On the date of publication, Larry Ramer held long positions in CELH and XPEV. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.