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華爾街日報3 High-Flying Stocks That Fall Short
Expensive stocks often command premium valuations because the market thinks their business models are exceptional. However, the downside is that high expectations are already baked into their prices, leaving little room for error if they stumble even slightly.
Finding the right balance between price and quality can challenge even the most skilled investors. Luckily for you, we started StockStory to help you identify the real opportunities. That said, here are three high-flying stocks with big downside risk and some other investments you should consider instead.
National Vision (EYE)
Forward P/E Ratio: 29.3x
Operating under multiple brands, National Vision (NYSE:EYE) sells optical products such as eyeglasses and provides optical services such as eye exams.
Why Is EYE Risky?
- Sales tumbled by 1.6% annually over the last three years, showing consumer trends are working against its favor
- Recent store closures reflect a shift toward streamlining existing locations to maximize efficiency
- Low returns on capital reflect management’s struggle to allocate funds effectively, and its shrinking returns suggest its past profit sources are losing steam
National Vision’s stock price of $25.96 implies a valuation ratio of 29.3x forward P/E. To fully understand why you should be careful with EYE, check out our full research report (it’s free for active Edge members).
Vishay Precision (VPG)
Forward P/E Ratio: 41.4x
Emerging from Vishay Intertechnology in 2010, Vishay Precision (NYSE:VPG) operates as a global provider of precision measurement and sensing technologies.
Why Should You Sell VPG?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 9% annually over the last two years
- Earnings per share fell by 15.3% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
- Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
At $38.89 per share, Vishay Precision trades at 41.4x forward P/E. Read our free research report to see why you should think twice about including VPG in your portfolio.
CoStar (CSGP)
Forward P/E Ratio: 56.3x
With a research department that makes over 10,000 property updates daily to its 35-year-old database, CoStar Group (NASDAQ:CSGP) provides comprehensive real estate data, analytics, and online marketplaces for commercial and residential properties in the U.S. and U.K.
Why Are We Wary of CSGP?
- Performance over the past five years shows its incremental sales were much less profitable, as its earnings per share fell by 2.8% annually
- Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 17.1 percentage points
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
CoStar is trading at $67.60 per share, or 56.3x forward P/E. If you’re considering CSGP for your portfolio, see our FREE research report to learn more.
Stocks We Like More
The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today.