“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 where the price is not right.
Two High-Flying Stocks to Sell:
RadNet (RDNT)
Forward P/E Ratio: 110.2x
With over 350 imaging facilities across seven states and a growing artificial intelligence division, RadNet (NASDAQ: RDNT) operates a network of outpatient diagnostic imaging centers across the United States, offering services like MRI, CT scans, PET scans, mammography, and X-rays.
Why Does RDNT Worry Us?
- Incremental sales over the last five years were much less profitable as its earnings per share fell by 7.8% annually while its revenue grew
- Lacking free cash flow generation means it has few chances to reinvest for growth, repurchase shares, or distribute capital
- Below-average returns on capital indicate management struggled to find compelling investment opportunities, and its shrinking returns suggest its past profit sources are losing steam
At $78.45 per share, RadNet trades at 110.2x forward P/E. Dive into our free research report to see why there are better opportunities than RDNT.
Centrus Energy (LEU)
Forward P/E Ratio: 41.3x
Operating the only active U.S. facility licensed to produce high-assay low-enriched uranium (HALEU) for next-generation reactors, Centrus Energy (NYSE: LEU) supplies enriched uranium, the fissile component needed to produce fuel for nuclear power reactors.
Why Do We Steer Clear of LEU?
- Revenue base of $473.9 million puts it at a disadvantage compared to larger competitors exhibiting economies of scale
- High extraction costs and unfavorable asset economics are reflected in its low gross margin of 32.3%
- Efficiency has decreased over the last five years as its EBITDA margin fell by 46.1 percentage points
Centrus Energy is trading at $150.30 per share, or 41.3x forward P/E. Read our free research report to see why you should think twice about including LEU in your portfolio.
One High-Flying Stock to Watch:
Novanta (NOVT)
Forward P/E Ratio: 33.3x
Originally a pioneer in the laser scanning industry during the late 1960s, Novanta (NASDAQ: NOVT) offers medicine and manufacturing technology to the medical, life sciences, and manufacturing industries.
Why Does NOVT Catch Our Eye?
- Annual revenue growth of 10.7% over the past five years was outstanding, reflecting market share gains this cycle
- Demand for the next 12 months is expected to accelerate above its two-year trend as Wall Street forecasts robust revenue growth of 20.5%
- Superior product capabilities and pricing power lead to a stellar gross margin of 44.4%
Novanta’s stock price of $134.02 implies a valuation ratio of 33.3x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
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-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.
