The stocks featured in this article have all approached their 52-week highs. When these price levels hit, it typically signals strong business execution, positive market sentiment, or significant industry tailwinds.
But not every company with momentum is a long-term winner, and plenty of investors have lost money betting on short-term fads. On that note, here are three overhyped stocks that may correct and some you should consider instead.
Interface (TILE)
One-Month Return: +26.6%
Pioneering carbon-neutral flooring since its founding in 1973, Interface (NASDAQ: TILE) is a global manufacturer of modular carpet tiles, luxury vinyl tile (LVT), and rubber flooring that specializes in carbon-neutral and sustainable flooring solutions.
Why Are We Hesitant About TILE?
- Muted 1.8% annual revenue growth over the last five years shows its demand lagged behind its business services peers
- Earnings growth over the last five years fell short of the peer group average as its EPS only increased by 1.9% annually
- ROIC of 10.9% reflects management’s challenges in identifying attractive investment opportunities
Interface is trading at $26.74 per share, or 14.7x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than TILE.
STERIS (STE)
One-Month Return: +7.2%
With a mission critical role in preventing healthcare-associated infections, STERIS (NYSE: STE) provides infection prevention products, sterilization services, and medical equipment that help healthcare facilities and life science companies maintain sterile environments.
Why Is STE Not Exciting?
- Below-average returns on capital indicate management struggled to find compelling investment opportunities
At $244.77 per share, STERIS trades at 23.9x forward P/E. Check out our free in-depth research report to learn more about why STE doesn’t pass our bar.
Valley National Bank (VLY)
One-Month Return: +9.9%
Tracing its roots back to 1927 during the economic boom before the Great Depression, Valley National Bancorp (NASDAQGS:VLY) operates Valley National Bank, providing commercial, consumer, and wealth management banking services across several states.
Why Does VLY Fall Short?
- Sales tumbled by 2.1% annually over the last two years, showing market trends are working against its favor during this cycle
- Net interest margin of 2.9% reflects its high servicing and capital costs
- Earnings per share decreased by more than its revenue over the last two years, showing each sale was less profitable
Valley National Bank’s stock price of $10.42 implies a valuation ratio of 0.8x forward P/B. Read our free research report to see why you should think twice about including VLY in your portfolio.
Stocks We Like More
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking 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 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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