Expensive stocks typically earn their valuations through superior growth rates that other companies simply can’t match. The flip side though is that these lofty expectations make them particularly susceptible to drawdowns when market sentiment shifts.
Separating true intrinsic value from speculation isn’t easy, especially during bull markets. That’s where StockStory comes in - to help you find high-quality companies that will stand the test of time. Keeping that in mind, here is one high-flying stock expanding its competitive advantage and two facing an uphill battle.
Two High-Flying Stocks to Sell:
Concrete Pumping (BBCP)
Forward P/E Ratio: 48.6x
Going public via SPAC in 2018, Concrete Pumping (NASDAQ: BBCP) is a provider of concrete pumping and waste management services in the United States and the United Kingdom.
Why Do We Think Twice About BBCP?
- Sales tumbled by 4.1% annually over the last two years, showing market trends are working against it during this cycle
- Earnings per share have dipped by 33.1% annually over the past two years, which is concerning because stock prices follow EPS over the long term
- ROIC of 6.6% reflects management’s challenges in identifying attractive investment opportunities
At $11.05 per share, Concrete Pumping trades at 48.6x forward P/E. Read our free research report to see why you should think twice about including BBCP in your portfolio.
RXO (RXO)
Forward P/E Ratio: 210.9x
With access to millions of trucks, RXO (NYSE: RXO) offers full-truckload, less-than-truckload, and last-mile deliveries.
Why Do We Avoid RXO?
- Declining unit sales over the past two years suggest it might have to lower prices to accelerate growth
- Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
- Limited cash reserves may force the company to seek unfavorable financing terms that could dilute shareholders
RXO is trading at $28.26 per share, or 210.9x forward P/E. Check out our free in-depth research report to learn more about why RXO doesn’t pass our bar.
One High-Flying Stock to Buy:
Monolithic Power Systems (MPWR)
Forward P/E Ratio: 57.7x
Founded in 1997 by its longtime CEO Michael Hsing, Monolithic Power Systems (NASDAQ: MPWR) is an analog and mixed signal chipmaker that specializes in power management chips meant to minimize total energy consumption.
Why Is MPWR a Good Business?
- Market share has increased this cycle as its 25.9% annual revenue growth over the last five years was exceptional
- Incremental sales over the last five years have been highly profitable as its earnings per share increased by 27.7% annually, topping its revenue gains
- Market-beating returns on capital illustrate that management has a knack for investing in profitable ventures
Monolithic Power Systems’s stock price of $1,599 implies a valuation ratio of 57.7x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
Stocks We Like Even More
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
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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-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.
