Each stock in this article is trading near its 52-week high. These elevated prices usually indicate some degree of investor confidence, business improvements, or favorable market conditions.

While momentum can be a leading indicator, it has burned many investors as it doesn’t always correlate with long-term success. On that note, here are three overhyped stocks that may correct and some you should consider instead.

Zoom (ZM)

One-Month Return: +14.4%

Once the verb that defined remote work during the pandemic ("let's Zoom later"), Zoom (NASDAQ: ZM) provides a cloud-based platform for video meetings, phone calls, team chat, and collaboration tools that helps businesses and individuals connect virtually.

Why Is ZM Risky?

1. Offerings struggled to generate meaningful interest as its average billings growth of 3.9% over the last year did not impress
2. Competitive market dynamics make it difficult to retain customers, leading to a weak 98% net revenue retention rate
3. Demand will likely be soft over the next 12 months as Wall Street’s estimates imply tepid growth of 3.6%

Zoom’s stock price of $89.93 implies a valuation ratio of 5.5x forward price-to-sales. Dive into our free research report to see why there are better opportunities than ZM.

Expedia (EXPE)

One-Month Return: +16.3%

Originally founded as a part of Microsoft, Expedia (NASDAQ: EXPE) is one of the world’s leading online travel agencies.

Why Are We Wary of EXPE?

1. Large revenue base makes it harder to increase sales quickly, and its annual revenue growth of 8.3% over the last three years was below our standards for the consumer internet sector
2. Decision to emphasize platform growth over monetization has contributed to 1.7% annual declines in its average revenue per booking
3. Excessive marketing spend signals little organic demand and traction for its platform

Expedia is trading at $289.71 per share, or 10.4x forward EV/EBITDA. If you’re considering EXPE for your portfolio, see our FREE research report to learn more.

First Commonwealth Financial (FCF)

One-Month Return: +7.4%

Tracing its roots back to the Great Depression era of 1934, First Commonwealth Financial (NYSE: FCF) is a financial holding company that provides consumer and commercial banking, wealth management, and insurance services across Pennsylvania and Ohio.

Why Does FCF Fall Short?

1. 3.2% annual revenue growth over the last two years was slower than its banking peers
2. Net interest income trends were unexciting over the last five years as its 8.6% annual growth was below the typical banking firm
3. Earnings per share fell by 6.6% annually over the last two years while its revenue grew, showing its incremental sales were much less profitable

At $17.30 per share, First Commonwealth Financial trades at 1.1x forward P/B. Check out our free in-depth research report to learn more about why FCF doesn’t pass our bar.

High-Quality Stocks for All Market Conditions

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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).

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