The stocks in this article are all trading near their 52-week highs. This strength often reflects positive developments such as new product launches, favorable industry trends, or improved financial performance.
But not every company with momentum is a long-term winner, and plenty of investors have lost money betting on short-term fads. Keeping that in mind, here are three stocks that are likely overheated and some you should look into instead.
Upland Software (UPLD)
One-Month Return: +7.3%
Operating under the mantra "land and expand," Upland Software (NASDAQ:UPLD) provides cloud-based applications that help organizations manage projects, workflows, and digital transformation across various business functions.
Why Do We Steer Clear of UPLD?
- Offerings couldn’t generate interest over the last year as its billings have averaged 25.1% declines
- Sales are expected to decline once again over the next 12 months as it continues working through a challenging demand environment
- Customer acquisition costs take a while to recoup, making it difficult to justify sales and marketing investments that could increase revenue
Upland Software’s stock price of $5.77 implies a valuation ratio of 0.9x forward price-to-sales. Dive into our free research report to see why there are better opportunities than UPLD.
Insight Enterprises (NSIT)
One-Month Return: +32.7%
With over 35 years of IT expertise and partnerships with more than 8,000 technology providers, Insight Enterprises (NASDAQ:NSIT) provides end-to-end digital transformation solutions that help businesses modernize their IT infrastructure and maximize the value of technology.
Why Are We Cautious About NSIT?
- Products and services are facing end-market challenges during this cycle, as seen in its flat sales over the last five years
- Lacking free cash flow generation means it has few chances to reinvest for growth, repurchase shares, or distribute capital
- Diminishing returns on capital suggest its earlier profit pools are drying up
At $153.08 per share, Insight Enterprises trades at 12.4x forward P/E. If you’re considering NSIT for your portfolio, see our FREE research report to learn more.
United Bankshares (UBSI)
One-Month Return: +3.3%
With roots dating back to 1982 and a strong presence in the Mid-Atlantic region, United Bankshares (NASDAQ:UBSI) is a bank holding company that provides commercial and retail banking services through its United Bank subsidiary across multiple states.
Why Do We Avoid UBSI?
- Net interest income trends were unexciting over the last five years as its 8.5% annual growth was below the typical banking firm
- Estimated net interest income growth of 4% for the next 12 months implies demand will slow from its five-year trend
- Earnings per share lagged its peers over the last five years as they only grew by 3.2% annually
United Bankshares is trading at $49.15 per share, or 1.2x forward P/B. Read our free research report to see why you should think twice about including UBSI in your portfolio.
Stocks We Like More
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,552% between June 2020 and June 2025). Find your next big winner with StockStory today.