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. All that said, here are three overhyped stocks that may correct and some you should consider instead.
Rockwell Automation (ROK)
One-Month Return: +4.3%
One of the first companies to address industrial automation, Rockwell Automation (NYSE:ROK) sells products that help customers extract more efficiency from their machinery.
Why Do We Pass on ROK?
- Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
- Performance over the past two years shows each sale was less profitable as its earnings per share dropped by 8.9% annually, worse than its revenue
- Eroding returns on capital suggest its historical profit centers are aging
Rockwell Automation’s stock price of $364.55 implies a valuation ratio of 32.7x forward P/E. If you’re considering ROK for your portfolio, see our FREE research report to learn more.
Vishay Precision (VPG)
One-Month Return: +24.7%
Emerging from Vishay Intertechnology in 2010, Vishay Precision (NYSE:VPG) operates as a global provider of precision measurement and sensing technologies.
Why Should You Sell VPG?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 10.2% annually over the last two years
- Performance over the past five years shows its incremental sales were much less profitable, as its earnings per share fell by 17.4% annually
- Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions
At $39.96 per share, Vishay Precision trades at 38x forward P/E. To fully understand why you should be careful with VPG, check out our full research report (it’s free for active Edge members).
Vulcan Materials (VMC)
One-Month Return: -3.8%
Founded in 1909, Vulcan Materials (NYSE:VMC) is a producer of construction aggregates, primarily crushed stone, sand, and gravel.
Why Does VMC Give Us Pause?
- 1.3% annual revenue growth over the last two years was slower than its industrials peers
- Demand for its offerings was relatively low as its number of tons shipped has underwhelmed
- High input costs result in an inferior gross margin of 25.2% that must be offset through higher volumes
Vulcan Materials is trading at $295.80 per share, or 30.2x forward P/E. Read our free research report to see why you should think twice about including VMC in your portfolio.
High-Quality Stocks for All Market Conditions
When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.
Don’t let fear keep you from great opportunities and take a look at Top 5 Strong Momentum Stocks for this week. 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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