5 Stocks To Avoid Right Now

Picking which stocks to sell or avoid can be a tricky business. Even stocks that are deemed “overvalued” can continue trading on momentum for days, weeks and even months before correcting. However, stocks that have stretched valuations typically have the furthest to fall in the event of a sell-off, making them prime candidates to avoid if you’re looking to reduce the risk in your portfolio…

To help identify stocks that should be avoided, GOBankingRates looked at the 50 most overvalued stocks in terms of price-to-earnings ratios and cross-referenced these with stocks labeled 4 or 5 by Zacks Investment Research, which correspond to “sell” and “strong sell” ratings, respectively. The 5 most overvalued stocks by these parameters are listed here.

There’s no guarantee these stocks won’t get even more overvalued before they finally meet selling pressure. However, if you’re looking to avoid risk, you might consider consulting with your financial advisor and selecting different stocks to own.

Tyler Technologies (TYL)

  • P/E Ratio: 89.64
  • Zacks Rank: 4
  • Price: $396.59
  • Market Cap: $16,156,560,883
  • EPS: $4.42
  • VGM Score: B

Tyler Technologies has had a great run, posting gains of over 70% in 2019 and 42% in 2020. This has pushed the stock up to an overinflated P/E. one of the reasons Zacks views the stock as a “sell.” Some investors have begun taking profits in the stock, which is down over 7% year-to-date.

Duke Energy Corp. (DUK)

  • P/E Ratio: 58.73
  • Zacks Rank: 4
  • Price: $102.49
  • Market Cap: $78,837,243,417
  • EPS: $1.75
  • VGM Score: B

Utilities don’t often make the list of “most-overvalued” stocks, but then again, most utilities don’t sport a P/E ratio of 58.73 times earnings. The consensus among analysts is that the stock has maybe a few points left in it for the next 12 months, if that.

Marketaxess Holdings (MKTX)

  • P/E Ratio: 55.89
  • Zacks Rank: 4
  • Price: $446.70
  • Market Cap: $16,966,863,619
  • EPS: $7.99
  • VGM Score: D

In terms of analytics, Mareketaxess Holdings stock doesn’t have…

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