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4 Stocks Trading Near 52-Week Highs with Room to Rise Further
Stocks hitting their 52-week high and delivering consistent performances offer attractive opportunities to investors while building a portfolio. This is because stocks near that level are perceived to be winners. However, stocks touching a new 52-week high are often predisposed to profit-taking, resulting in pullbacks and trend reversals.
Given the high price, investors often wonder if the stock is overpriced. While the speculations are not absolutely baseless, all stocks hitting a 52-week high are not necessarily overpriced.
Investors might lose out on top gainers in an attempt to avoid the steep prices.
Stocks such as Murphy USA, DaVita, Microchip Technology and Cenovus Energy are expected to maintain their momentum and keep scaling new highs. Extensive information on a stock is necessary to understand whether or not there is scope for upside.
Here, we discuss a strategy to find the right stocks. The strategy borrows from the basics of momentum investing. This technique bets on "buy high, sell higher."
52-Week High: A Good Indicator
Many times, stocks that hit a 52-week high fail to scale higher despite having potential. This is because investors fear that the stocks are overvalued and expect the price to crash.
Overvaluation is natural for most of these stocks as investors' focus (or willingness to pay a premium) has helped them reach the level. But that does not always indicate an impending decline. Factors such as robust sales, surging profit levels, earnings growth prospects and strategic acquisitions that encourage investors to bet on these stocks could keep them motivated if there is no tangible negative. In other words, the momentum might continue.
Also, when a string of positive developments dominates the market, investors find their underreaction unwarranted, even if there are no company-specific driving forces.
Here are our four picks out of the 29 stocks, each carrying a Zacks Rank #1, that made it through the screen:
Murphy USA presents a near-term fundamental case. First-quarter 2026 results showed net income of $136.3 million ($7.28 per diluted share) compared with $53.2 million in the year-ago quarter. Total fuel contribution jumped to 35.0 cpg from 25.4 cpg due to market volatility and fuel supply strength. Merchandise contribution grew 7.3% to $210.2 million on unit margins of 20.0%. April all-in margins are tracking 35–40 cpg with volumes roughly flat year-over-year.
Full-year 2026 guidance targets merchandise contribution of $890–$900 million and Adjusted EBITDA of approximately $1 billion. With 28 stores under construction and 45–55 new openings planned, organic growth supports earnings expansion. In May 2026, the board raised the quarterly dividend to 64 cents per share; a $2 billion repurchase authorization reinforces shareholder returns.
The Zacks Consensus Estimate for the company's 2026 earnings has moved 26.5% north to $31.48 per share in the past 60 days. MUSA surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 16.56%.
DaVita enters the near term with strengthened fundamentals following first-quarter 2026 results. Revenues reached $3.42 billion, up approximately 6% year over year, driven by improved treatment volumes, a 4% rise in revenue per treatment, and lower patient care costs. Adjusted operating income of $482 million came in $50 million ahead of plan.
Management raised full-year adjusted operating income guidance to $2.15–$2.25 billion and adjusted EPS guidance to $14.10–$15.20. The Integrated Kidney Care segment recorded record aggregate CKCC program savings, reflecting a 4.5% gross savings rate improvement. Volume gains are further supported by patient transfers from competitor clinic closures. Deployment of AI-driven staffing tools and sustained labor efficiencies underpin the company's 2.6% five-year cost CAGR target, reinforcing near-term operational momentum.
The Zacks Consensus Estimate for the company's 2026 earnings has moved 6.4% north to $15.07 per share in the past 60 days. DVA's earnings surpassed the Zacks Consensus Estimate thrice in the trailing four quarters while missing the same once, the average surprise being 2.4%.
Microchip Technology's near-term fundamentals reflect a well-grounded recovery. Fourth-quarter fiscal 2026 net sales of $1.311 billion exceeded the guidance midpoint, rising 35.1% year over year and 10.6% sequentially. Non-GAAP EPS of 57 cents beat the guided 48–52 cents range. Distributor inventory fell to 26 days, near the low end of historical norms, enabling higher factory utilization and margin expansion ahead.
For the first quarter of fiscal 2027, the company guided net sales of $1.442–$1.469 billion — up 11% sequentially — with non-GAAP EPS of 67–71 cents and non-GAAP gross margin of 62.25%–63.25%. April 2026 product launches, including post-quantum cryptography root of trust controllers and expanded CLB-based MCUs, deepen Microchip's addressable footprint in data center, defense, and industrial markets. A quarterly dividend of 45.5 cents per share underscores financial discipline.
The Zacks Consensus Estimate for the company's 2026 earnings has moved 18% north to $3.02 per share in the past 60 days. MCHP surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 8.72%.
Cenovus Energy presents a near-term fundamental case grounded in production strength and robust cash generation. First-quarter 2026 upstream production reached a record 972,100 BOE/d, up 19% year over year, with free funds flow of $2.2 billion. Downstream operations delivered a 97% crude unit utilization rate and U.S. Refining adjusted market capture of 114%. The board raised the quarterly base dividend 10% to 22 cents per share beginning the second quarter of 2026, with $1.0 billion returned to shareholders in the first quarter.
Key catalysts include West White Rose's first oil targeted for the third quarter of 2026, Christina Lake North's 40-well redevelopment ramping through H2 2026, and Sunrise progressing toward 70,000 bbls/d by 2028. A $275 million commercial fuels divestiture supports progress toward the $4 billion long-term net debt target.
The Zacks Consensus Estimate for the company's 2026 earnings has increased by 166.4% to $3.01 per share in the past 60 days. CVE's earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 50.8%.
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
Zacks' 7 Best Strong Buy Stocks (New Research Report)
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Zacks.com featured highlights include Murphy USA, DaVita, Microchip Technology and Cenovus Energy
For Immediate Release
Chicago, IL – May 22, 2026 – Stocks in this week’s article are Murphy USA (MUSA - Free Report) , DaVita (DVA - Free Report) , Microchip Technology (MCHP - Free Report) and Cenovus Energy (CVE - Free Report) .
4 Stocks Trading Near 52-Week Highs with Room to Rise Further
Stocks hitting their 52-week high and delivering consistent performances offer attractive opportunities to investors while building a portfolio. This is because stocks near that level are perceived to be winners. However, stocks touching a new 52-week high are often predisposed to profit-taking, resulting in pullbacks and trend reversals.
Given the high price, investors often wonder if the stock is overpriced. While the speculations are not absolutely baseless, all stocks hitting a 52-week high are not necessarily overpriced.
Investors might lose out on top gainers in an attempt to avoid the steep prices.
Stocks such as Murphy USA, DaVita, Microchip Technology and Cenovus Energy are expected to maintain their momentum and keep scaling new highs. Extensive information on a stock is necessary to understand whether or not there is scope for upside.
Here, we discuss a strategy to find the right stocks. The strategy borrows from the basics of momentum investing. This technique bets on "buy high, sell higher."
52-Week High: A Good Indicator
Many times, stocks that hit a 52-week high fail to scale higher despite having potential. This is because investors fear that the stocks are overvalued and expect the price to crash.
Overvaluation is natural for most of these stocks as investors' focus (or willingness to pay a premium) has helped them reach the level. But that does not always indicate an impending decline. Factors such as robust sales, surging profit levels, earnings growth prospects and strategic acquisitions that encourage investors to bet on these stocks could keep them motivated if there is no tangible negative. In other words, the momentum might continue.
Also, when a string of positive developments dominates the market, investors find their underreaction unwarranted, even if there are no company-specific driving forces.
Here are our four picks out of the 29 stocks, each carrying a Zacks Rank #1, that made it through the screen:
Murphy USA presents a near-term fundamental case. First-quarter 2026 results showed net income of $136.3 million ($7.28 per diluted share) compared with $53.2 million in the year-ago quarter. Total fuel contribution jumped to 35.0 cpg from 25.4 cpg due to market volatility and fuel supply strength. Merchandise contribution grew 7.3% to $210.2 million on unit margins of 20.0%. April all-in margins are tracking 35–40 cpg with volumes roughly flat year-over-year.
Full-year 2026 guidance targets merchandise contribution of $890–$900 million and Adjusted EBITDA of approximately $1 billion. With 28 stores under construction and 45–55 new openings planned, organic growth supports earnings expansion. In May 2026, the board raised the quarterly dividend to 64 cents per share; a $2 billion repurchase authorization reinforces shareholder returns.
The Zacks Consensus Estimate for the company's 2026 earnings has moved 26.5% north to $31.48 per share in the past 60 days. MUSA surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 16.56%.
DaVita enters the near term with strengthened fundamentals following first-quarter 2026 results. Revenues reached $3.42 billion, up approximately 6% year over year, driven by improved treatment volumes, a 4% rise in revenue per treatment, and lower patient care costs. Adjusted operating income of $482 million came in $50 million ahead of plan.
Management raised full-year adjusted operating income guidance to $2.15–$2.25 billion and adjusted EPS guidance to $14.10–$15.20. The Integrated Kidney Care segment recorded record aggregate CKCC program savings, reflecting a 4.5% gross savings rate improvement. Volume gains are further supported by patient transfers from competitor clinic closures. Deployment of AI-driven staffing tools and sustained labor efficiencies underpin the company's 2.6% five-year cost CAGR target, reinforcing near-term operational momentum.
The Zacks Consensus Estimate for the company's 2026 earnings has moved 6.4% north to $15.07 per share in the past 60 days. DVA's earnings surpassed the Zacks Consensus Estimate thrice in the trailing four quarters while missing the same once, the average surprise being 2.4%.
Microchip Technology's near-term fundamentals reflect a well-grounded recovery. Fourth-quarter fiscal 2026 net sales of $1.311 billion exceeded the guidance midpoint, rising 35.1% year over year and 10.6% sequentially. Non-GAAP EPS of 57 cents beat the guided 48–52 cents range. Distributor inventory fell to 26 days, near the low end of historical norms, enabling higher factory utilization and margin expansion ahead.
For the first quarter of fiscal 2027, the company guided net sales of $1.442–$1.469 billion — up 11% sequentially — with non-GAAP EPS of 67–71 cents and non-GAAP gross margin of 62.25%–63.25%. April 2026 product launches, including post-quantum cryptography root of trust controllers and expanded CLB-based MCUs, deepen Microchip's addressable footprint in data center, defense, and industrial markets. A quarterly dividend of 45.5 cents per share underscores financial discipline.
The Zacks Consensus Estimate for the company's 2026 earnings has moved 18% north to $3.02 per share in the past 60 days. MCHP surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 8.72%.
Cenovus Energy presents a near-term fundamental case grounded in production strength and robust cash generation. First-quarter 2026 upstream production reached a record 972,100 BOE/d, up 19% year over year, with free funds flow of $2.2 billion. Downstream operations delivered a 97% crude unit utilization rate and U.S. Refining adjusted market capture of 114%. The board raised the quarterly base dividend 10% to 22 cents per share beginning the second quarter of 2026, with $1.0 billion returned to shareholders in the first quarter.
Key catalysts include West White Rose's first oil targeted for the third quarter of 2026, Christina Lake North's 40-well redevelopment ramping through H2 2026, and Sunrise progressing toward 70,000 bbls/d by 2028. A $275 million commercial fuels divestiture supports progress toward the $4 billion long-term net debt target.
The Zacks Consensus Estimate for the company's 2026 earnings has increased by 166.4% to $3.01 per share in the past 60 days. CVE's earnings surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 50.8%.
For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/2924861/4-stocks-trading-near-52-week-high-with-room-to-rise-further
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.
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Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Contact: Jim Giaquinto
Company: Zacks.com
Phone: 312-265-9268
Email: pr@zacks.com
Visit: https://www.zacks.com/
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.