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.
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. That said, here are two high-flying stocks expanding their competitive advantages and one where the price is not right.
One High-Flying Stock to Sell:
AeroVironment (AVAV)
Forward P/E Ratio: 57.5x
Focused on the future of autonomous military combat, AeroVironment (NASDAQ:AVAV) specializes in advanced unmanned aircraft systems and electric vehicle charging solutions.
Why Are We Wary of AVAV?
- Costs have risen faster than its revenue over the last five years, causing its operating margin to decline by 13.5 percentage points
- Cash-burning history makes us doubt the long-term viability of its business model
- Negative returns on capital show management lost money while trying to expand the business
AeroVironment’s stock price of $188.21 implies a valuation ratio of 57.5x forward P/E. Dive into our free research report to see why there are better opportunities than AVAV.
Two High-Flying Stocks to Watch:
Datadog (DDOG)
Forward P/S Ratio: 17.6x
Named after a database the founders had to painstakingly look after at their previous company, Datadog (NASDAQ:DDOG) provides a software platform that helps organizations monitor and secure their cloud applications, infrastructure, and services.
Why Will DDOG Beat the Market?
- ARR trends over the last year show it’s maintaining a steady flow of long-term contracts that contribute positively to its revenue predictability
- Market share will likely rise over the next 12 months as its expected revenue growth of 24.5% is robust
- Software platform has product-market fit given the rapid recovery of its customer acquisition costs
At $260.38 per share, Datadog trades at 17.6x forward price-to-sales. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.
Boeing (BA)
Forward P/E Ratio: 193.2x
One of the companies that forms a duopoly in the commercial aircraft market, Boeing (NYSE:BA) develops, manufactures, and services commercial airplanes, defense products, and space systems.
Why Does BA Catch Our Eye?
- Unit sales averaged 60.4% growth over the past two years and imply healthy demand for its products
- Estimated revenue growth of 12.3% for the next 12 months implies its momentum over the last two years will continue
- Performance over the past two years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 48.1% outpaced its revenue gains
Boeing is trading at $232.65 per share, or 193.2x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time.
Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.