3 Stocks Came Roaring Back—Now They're Flashing Warning Signs

Intuit has rebounded sharply from its 2026 low as investors await another earnings report and fresh guidance on tax growth. MGM Resorts has rallied on takeover speculation, but the market is still weighing deal risk and softer Las Vegas trends. Leidos Holdings has bounced strongly from its summer low following a solid quarter, putting its recent run back under scrutiny.

Markets have been on a wild ride this summer, with the S&P 500 finally making a new all-time high and several left-for-dead stocks showing new life in the second half of the year. But not all rallies are created equally. Three catalyst-driven stocks have bounced more than 30% off their 2026 lows, but each still carries fundamental questions that could complicate the rebound. Catalysts can drive stocks to unprecedented heights, but they can also mask underlying fundamental weakness, and that’s the common theme among these three summer standouts. After such sharp rebounds, is it time for investors to take profits?

Intuit Inc. NASDAQ: INTU has been one of the poster children of the software apocalypse, and the stock is still down more than 40% year-to-date (YTD) despite the recent rally. Investors had reason to exhale when the company reported its fiscal Q3 2026 numbers on May 20, posting earnings per share (EPS) and revenue above expectations, with sales growing more than 10% year-over-year (YOY). But as always, the underlying numbers tell the story, and much of this growth is coming from price increases, not new business. Average revenue per user (ARPU) rose 11%, with paid online units up 2%, but total online units declined 2%. Intuit is getting more cash from each customer but losing market share, especially among DIY filers earning under $50,000 annually. TurboTax Live, which offers expert advice from tax professionals, now accounts for more than 50% of the franchise’s revenue. The company laid off 17% of its workforce as a cost-cutting measure, but selling more assisted services and less software creates some potentially painful arithmetic for Intuit in fiscal 2027. INTU shares began 2026 with a Death Cross-aided drawdown that cascaded more than 60% between January and June. But the stock is now 30% off that June low and recently broke through the 50-day moving average, which has been stiff resistance since the decline began. However, this minor technical milestone has pushed the Relative Strength Index (RSI) into overbought territory, even as the price remains well below the 200-day moving average. Intuit reports fiscal Q4 2026 results on Aug. 25, and the market expects quarterly EPS of $1.43 and revenue of $4.28 billion. But investors and analysts will be watching the full-year guidance projections for fiscal 2027 more closely. A conservative guide will fuel the AI-disruption trade in many investors’ minds and validate the Sell rating Goldman Sachs gave the stock last year.

Shares of MGM Resorts International NYSE: MGM jumped from about $32 to $50 earlier this summer based on excitement surrounding two catalysts. First, a series of price target boosts from analysts in April and May, which included a pair of prescient upgrades from Truist Financial and KeyCorp.