"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 with strong fundamentals and two climbing an uphill battle.
Two High-Flying Stocks to Sell:
Rush Street Interactive (RSI)
Forward P/E Ratio: 33x
Specializing in online casino gaming and sports betting, Rush Street Interactive (NYSE: RSI) is an operator of digital gaming platforms.
Why Do We Steer Clear of RSI?
- Sluggish trends in its monthly active users suggest customers aren’t adopting its solutions as quickly as the company hoped
- Poor expense management has led to an operating margin of 5.4% that is below the industry average
- Free cash flow margin is forecasted to shrink by 2.2 percentage points in the coming year, suggesting the company will consume more capital to keep up with its competitors
Rush Street Interactive is trading at $18.67 per share, or 33x forward P/E. To fully understand why you should be careful with RSI, check out our full research report (it’s free).
CoStar (CSGP)
Forward P/E Ratio: 41.9x
With a research department that makes over 10,000 property updates daily to its 35-year-old database, CoStar Group (NASDAQ: CSGP) provides comprehensive real estate data, analytics, and online marketplaces for commercial and residential properties in the U.S. and U.K.
Why Are We Wary of CSGP?
- Earnings per share fell by 3.8% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
- 17.1 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
At $49.83 per share, CoStar trades at 41.9x forward P/E. Dive into our free research report to see why there are better opportunities than CSGP.
One High-Flying Stock to Buy:
AMD (AMD)
Forward P/E Ratio: 29.9x
Founded in 1969 by a group of former Fairchild semiconductor executives led by Jerry Sanders, Advanced Micro Devices (NASDAQ: AMD) is one of the leading designers of computer processors and graphics chips used in PCs and data centers.
Why Is AMD a Good Business?
- Annual revenue growth of 28.8% over the last five years was superb and indicates its market share increased during this cycle
- Projected revenue growth of 34.6% for the next 12 months is above its two-year trend, pointing to accelerating demand
- Earnings per share have massively outperformed its peers over the last five years, increasing by 26.4% annually
AMD’s stock price of $203.17 implies a valuation ratio of 29.9x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
Stocks We Like Even More
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. 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 244% over the last five years (as of June 30, 2025).
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-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.
