"You get what you pay for" often applies to expensive stocks with best-in-class business models and execution. While their quality can sometimes justify the premium, they typically experience elevated volatility during market downturns when expectations change.
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 climbing an uphill battle.
Two High-Flying Stocks to Sell:
Shake Shack (SHAK)
Forward P/E Ratio: 65.3x
Started as a hot dog cart in New York City's Madison Square Park, Shake Shack (NYSE: SHAK) is a fast-food restaurant known for its burgers and milkshakes.
Why Do We Think Twice About SHAK?
- Responsiveness to unforeseen market trends is restricted due to its substandard operating margin profitability
- Low returns on capital reflect management’s struggle to allocate funds effectively
Shake Shack’s stock price of $89.33 implies a valuation ratio of 65.3x forward P/E. Check out our free in-depth research report to learn more about why SHAK doesn’t pass our bar.
Live Nation (LYV)
Forward P/E Ratio: 114.2x
Owner of Ticketmaster and operator of music festival EDC, Live Nation (NYSE: LYV) is a company specializing in live event promotion, venue management, and ticketing services for concerts and shows.
Why Are We Hesitant About LYV?
- The company has faced growth challenges as its 5.3% annual revenue increases over the last two years fell short of other consumer discretionary companies
- Poor expense management has led to an operating margin of 4.3% that is below the industry average
- Capital intensity will likely increase as its free cash flow margin is anticipated to drop by 1.1 percentage points over the next year
Live Nation is trading at $155.23 per share, or 114.2x forward P/E. Dive into our free research report to see why there are better opportunities than LYV.
One High-Flying Stock to Buy:
CrowdStrike (CRWD)
Forward P/S Ratio: 17.4x
Known for detecting the massive SolarWinds hack in 2020 that compromised numerous government agencies, CrowdStrike (NASDAQ: CRWD) provides cloud-based cybersecurity solutions that protect endpoints, cloud workloads, identity, and data through its Falcon platform.
Why Are We Bullish on CRWD?
- Winning new contracts that can potentially increase in value as its billings growth has averaged 26% over the last year
- Sales outlook for the upcoming 12 months implies the business will stay on its desirable two-year growth trajectory
- User-friendly software enables clients to ramp up spending quickly, leading to the speedy recovery of customer acquisition costs
At $398.61 per share, CrowdStrike trades at 17.4x forward price-to-sales. Is now the right time to buy? See for yourself in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don't just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
But our AI platform says the party isn't over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE.
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 Kadant (+351% five-year return). Find your next big winner with StockStory today.
