Some stocks fly under the radar of investors even as they quietly dominate the industry in which they operate. These stealth stocks rise to the top by developing competitive advantages. This allows them to take market share from competitors and deliver strong financial results.
Wall Street analysts who cover specific economic sectors and their competing stocks might notice the dominance of a particular company. However, retail investors often miss out. Lack of media coverage and attention to certain stocks allows them to slip by unnoticed. And this can happen even as their share price steadily rises.
Let’s explore three such hot stocks that could surely dominate their sectors.
Corning (GLW)
Specialty glassmaker Corning (NYSE:GLW) doesn’t get much attention. But its shares are up 12% on the day of this writing after the company raised its forward guidance ahead of its Q2 financial results to be released on July 30. Corning said that it expects revenue of $3.6 billion compared with previous guidance that had called for $3.4 billion in Q2 sales.
In terms of profit, Corning is now forecasting EPS at the “high end” of its range of 42 cents to 46 cents. Corning added that it is seeing increased sales as demand rises for its new optical connectivity products designed for artificial intelligence (AI). While still best known for its CorningWare line of cookware, the company divested that consumer products business back in 1998.
Today, Corning is a tech company that makes specialty glass that’s used for technological and scientific applications. In practical terms, Corning makes glass for big-screen TVs, mobile phones such as Apple’s (NASDAQ:AAPL) iPhone and fiber optics. GLW stock is now up 41% on the year.
Eli Lilly (LLY)
If Eli Lilly & Co. (NYSE:LLY) doesn’t already dominate the pharmaceutical industry, it looks like it will in short order. Since July 1, the company has received regulatory approval from the U.S. Food and Drug Administration (FDA) to begin selling its Alzheimer medication that is expected to be a blockbuster drug. Also, LLY announced that it is buying biopharmaceutical company Morphic Holding (NASDAQ:MORF) for $3.2 billion.
Morphic Holding develops treatments for chronic diseases, specifically inflammatory bowel disease. The deal is expected to help Eli Lilly expand further into the gastroenterology medical specialty. Last fall, the FDA approved Eli Lilly’s drug “Omvoh,” which is used to treat ulcerative colitis. Approval of the Alzheimer drug, called “Donanemab,” and the Morphic purchase come as Eli Lilly is struggling to meet global demand for its weight loss drug “Zepbound,” another blockbuster medication.
Given all the positive developments, it should come as no surprise that LLY stock has risen 102% over the last 12 months, making it among the best performing pharma stocks.
UBS (UBS)
In the banking sector, Swiss financial giant UBS Group (NYSE:UBS) looks to have a more dominant position after completing its merger with former rival Credit Suisse on July 1. UBS agreed to acquire Credit Suisse in 2023 for $3.2 billion after that bank’s failure. The takeover of Credit Suisse has left Switzerland, arguably the world’s best known banking center, with one global bank that has a balance sheet twice as large as the country’s economy.
If nothing else, the absorption of Credit Suisse gives UBS sufficient size to better compete against major international lenders such as JPMorgan Chase (NYSE:JPM) in the U.S. and HSBC Holdings (NYSE:HSBC) in the U.K. Also, the deal’s completion gives UBS a near monopoly position as the only full-service depository bank in its home country of Switzerland, whose population is just under nine million people. UBS stock has risen 52% in the last 12 months.
On the date of publication, Joel Baglole held a long position in LLY. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
