"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 to hold for the long term and two climbing an uphill battle.
Two High-Flying Stocks to Sell:
Hilton (HLT)
Forward P/E Ratio: 32.4x
Founded in 1919, Hilton Worldwide (NYSE: HLT) is a global hospitality company with a portfolio of hotel brands.
Why Do We Avoid HLT?
- Softer revenue per room over the past two years suggests it might have to invest in new amenities such as restaurants and bars to attract customers
- Free cash flow margin is projected to show no improvement next year
- ROIC of 26.2% reflects management’s challenges in identifying attractive investment opportunities
Hilton is trading at $301.49 per share, or 32.4x forward P/E. Check out our free in-depth research report to learn more about why HLT doesn’t pass our bar.
Repligen (RGEN)
Forward P/E Ratio: 58x
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 Are We Out on RGEN?
- Subscale operations are evident in its revenue base of $738.3 million, meaning it has fewer distribution channels than its larger rivals
- Efficiency has decreased over the last five years as its adjusted operating margin fell by 18.3 percentage points
- Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned
At $115.25 per share, Repligen trades at 58x forward P/E. To fully understand why you should be careful with RGEN, check out our full research report (it’s free).
One High-Flying Stock to Watch:
Costco (COST)
Forward P/E Ratio: 45.7x
Designed to be a one-stop shop for the suburban consumer, Costco (NASDAQ: COST) is a membership-only retail chain that sells groceries, apparel, toys, and household items, often in bulk quantities.
Why Is COST on Our Radar?
- Same-store sales growth averaged 6.2% over the past two years, showing it’s bringing new and repeat shoppers into its stores
- Unparalleled revenue scale of $286.3 billion offsets its poor gross margin and gives it advantageous pricing and terms with suppliers
- Industry-leading 34.7% return on capital demonstrates management’s skill in finding high-return investments, and its rising returns show it’s making even more lucrative bets
Costco’s stock price of $966.75 implies a valuation ratio of 45.7x forward P/E. Is now a good time to buy? 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.
