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.
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. Keeping that in mind, here are two high-flying stocks expanding their competitive advantages and one with big downside risk.
One High-Flying Stock to Sell:
Rush Street Interactive (RSI)
Forward P/E Ratio: 51.3x
Specializing in online casino gaming and sports betting, Rush Street Interactive (NYSE: RSI) is an operator of digital gaming platforms.
Why Are We Wary of RSI?
- Operating margin of 2.6% falls short of the industry average, and the smaller profit dollars make it harder to react to unexpected market developments
Rush Street Interactive’s stock price of $19.33 implies a valuation ratio of 51.3x forward P/E. If you’re considering RSI for your portfolio, see our FREE research report to learn more.
Two High-Flying Stocks to Watch:
SPX Technologies (SPXC)
Forward P/E Ratio: 28.9x
SPX Technologies (NYSE: SPXC) is an industrial conglomerate catering to the energy, manufacturing, automotive, and aerospace sectors.
Why Could SPXC Be a Winner?
- Impressive 12.5% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Operating profits increased over the last five years as the company gained some leverage on its fixed costs and became more efficient
- Earnings per share grew by 22.2% annually over the last two years, massively outpacing its peers
At $191.17 per share, SPX Technologies trades at 28.9x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free.
Pure Storage (PSTG)
Forward P/E Ratio: 32.7x
Founded in 2009 as a pioneer in enterprise all-flash storage technology, Pure Storage (NYSE: PSTG) provides all-flash data storage hardware and software that helps organizations manage their data more efficiently across on-premises and cloud environments.
Why Is PSTG a Good Business?
- Ability to secure long-term commitments with customers is evident in its 23.5% average ARR growth over the past two years
- Incremental sales significantly boosted profitability as its annual earnings per share growth of 29.5% over the last five years outstripped its revenue performance
- PSTG is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders, and its growing cash flow gives it even more resources to deploy
Pure Storage is trading at $59.50 per share, or 32.7x forward P/E. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.
The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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