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.
Determining whether a company’s quality justifies its price causes headaches for nearly all investors, which is why we started StockStory - to help you separate the real opportunities from the speculative ones. Keeping that in mind, here is one high-flying stock expanding its competitive advantage and two where the price is not right.
Two High-Flying Stocks to Sell:
Marriott (MAR)
Forward P/E Ratio: 31.3x
Founded by J. Willard Marriott in 1927, Marriott International (NASDAQ: MAR) is a global hospitality company with a portfolio of over 7,000 properties and 30 brands, spanning 130+ countries and territories.
Why Do We Steer Clear of MAR?
- Revenue per room has disappointed over the past two years due to weaker trends in its daily rates and occupancy levels
- Free cash flow margin is expected to remain in place over the coming year
- Improving returns on capital suggest management is identifying more profitable investments
Marriott’s stock price of $369.64 implies a valuation ratio of 31.3x forward P/E. Check out our free in-depth research report to learn more about why MAR doesn’t pass our bar.
LeMaitre (LMAT)
Forward P/E Ratio: 31.1x
Founded in 1983 and named after a pioneering vascular surgeon, LeMaitre Vascular (NASDAQGM:LMAT) develops and manufactures specialized medical devices used by vascular surgeons to treat peripheral vascular disease and other circulatory conditions.
Why Are We Hesitant About LMAT?
- Smaller revenue base of $256.3 million means it hasn’t achieved the economies of scale that some industry juggernauts enjoy
At $98.76 per share, LeMaitre trades at 31.1x forward P/E. Read our free research report to see why you should think twice about including LMAT in your portfolio.
One High-Flying Stock to Buy:
Vita Coco (COCO)
Forward P/E Ratio: 36.4x
Founded in 2004 followed by a 2021 IPO, The Vita Coco Company (NASDAQ: COCO) offers coconut water products that are a natural way to quench thirst.
Why Is COCO a Top Pick?
- Unit sales were phenomenal over the past two years, showing demand is robust and retailers can’t stock enough of its products
- Earnings growth has trumped its peers over the last three years as its EPS has compounded at 52.4% annually
- Market-beating returns on capital illustrate that management has a knack for investing in profitable ventures, and its rising returns show it’s making even more lucrative bets
Vita Coco is trading at $70.75 per share, or 36.4x forward P/E. Is now the time to initiate a position? See for yourself in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
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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.
