3 Overhyped Stocks to Avoid for a Dramatic Fall

Measuring a company’s fair value, especially for overhyped stocks, is more difficult than it seems at first glance. It has to account for future growth, and that growth has to have a valid basis. But even if that is accounted for, it is difficult to price in market irrationality alongside speculation.Both price-to-earnings (P/E) and enterprise value-to-earnings before interest, taxes, depreciation and amortization (EV/EBITDA) are often affected by the latter. A high P/E ratio is commonly found in high-growt ...