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. Keeping that in mind, here is one high-flying stock to hold for the long term and two where the price is not right.

Two High-Flying Stocks to Sell:

Lucky Strike (LUCK)

Forward P/E Ratio: 27.7x

Born from the transformation of traditional bowling alleys into modern entertainment destinations, Lucky Strike (NYSE: LUCK) operates bowling alleys and other entertainment venues with upscale amenities, arcade games, and food and beverage services across North America.

Why Are We Hesitant About LUCK?

1. Lagging same-store sales over the past two years suggest it might have to change its pricing and marketing strategy to stimulate demand
2. Cash-burning tendencies make us wonder if it can sustainably generate shareholder value
3. Short cash runway increases the probability of a capital raise that dilutes existing shareholders

Lucky Strike is trading at $8.31 per share, or 27.7x forward P/E. Check out our free in-depth research report to learn more about why LUCK doesn’t pass our bar.

Repligen (RGEN)

Forward P/E Ratio: 69.2x

With over 13 strategic acquisitions since 2012 to build its comprehensive bioprocessing portfolio, Repligen (NASDAQ: RGEN) develops and manufactures specialized technologies that improve the efficiency and flexibility of biological drug manufacturing processes.

Why Should You Sell RGEN?

1. Customers postponed purchases of its products and services this cycle as its revenue declined by 7.5% annually over the last two years
2. Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
3. Efficiency has decreased over the last five years as its adjusted operating margin fell by 14.8 percentage points

At $126.89 per share, Repligen trades at 69.2x forward P/E. If you’re considering RGEN for your portfolio, see our FREE research report to learn more.

One High-Flying Stock to Buy:

ServiceNow (NOW)

Forward P/S Ratio: 15x

Founded by Fred Luddy, who coded the company's initial prototype on a flight from San Francisco to London, ServiceNow (NYSE: NOW) is a software provider helping companies automate workflows across IT, HR, and customer service.

Why Will NOW Outperform?

1. Current remaining performance obligations (cRPO) have averaged 22.3% growth over the last year, showing it has a pipeline of unfulfilled contracts that will support revenue in the future
2. Excellent operating margin of 12.9% highlights the efficiency of its business model, and it turbocharged its profits by achieving some fixed cost leverage
3. Strong free cash flow margin of 32.1% enables it to reinvest or return capital consistently

ServiceNow’s stock price of $974.50 implies a valuation ratio of 15x forward price-to-sales. Is now the time to initiate a position? Find out in our full research report, it’s free.

Stocks We Like Even More

Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.

While this has caused many investors to adopt a "fearful" wait-and-see approach, we’re leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking 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 175% over the last five years.

Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Axon (+711% five-year return). Find your next big winner with StockStory today for free.