"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 expanding its competitive advantage and two where the price is not right.

Two High-Flying Stocks to Sell:

Hexcel (HXL)

Forward P/E Ratio: 39.6x

Founded shortly after World War II by a group of engineers from UC Berkley, Hexcel (NYSE: HXL) manufactures lightweight composite materials primarily for the aerospace and defense sectors.

Why Are We Out on HXL?

1. Sales trends were unexciting over the last five years as its 1.2% annual growth was below the typical industrials company
2. Flat earnings per share over the last two years lagged its peers
3. Underwhelming 5.8% return on capital reflects management’s difficulties in finding profitable growth opportunities

At $84.28 per share, Hexcel trades at 39.6x forward P/E. Read our free research report to see why you should think twice about including HXL in your portfolio.

XPO (XPO)

Forward P/E Ratio: 37.4x

Owning a mobile game simulating freight operations for the Tour de France, XPO (NYSE: XPO) is a transportation company specializing in expedited shipping services.

Why Should You Dump XPO?

1. Products and services are facing significant end-market challenges during this cycle as sales have declined by 1.4% annually over the last five years
2. High input costs result in an inferior gross margin of 14.7% that must be offset through higher volumes
3. Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 4.3 percentage points

XPO is trading at $153.95 per share, or 37.4x forward P/E. To fully understand why you should be careful with XPO, check out our full research report (it’s free).

One High-Flying Stock to Buy:

Lam Research (LRCX)

Forward P/E Ratio: 42.1x

Founded in 1980 by David Lam, the man who pioneered semiconductor etching technology, Lam Research (NASDAQ: LRCX) is one of the leading providers of wafer fabrication equipment used to make semiconductors.

Why Will LRCX Beat the Market?

1. Market share has increased this cycle as its 11.2% annual revenue growth over the last two years was exceptional
2. Free cash flow margin grew by 9.4 percentage points over the last five years, giving the company more chips to play with
3. Stellar returns on capital showcase management’s ability to surface highly profitable business ventures

Lam Research’s stock price of $218.84 implies a valuation ratio of 42.1x 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

Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.

The names generating the next wave of massive growth are right here in 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-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.