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Stock Strategist

The Market's Most Overvalued Stocks

There's still time to sell these stocks even after the recent market decline.

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After peaking in mid-July, the S&P 500 has lost about 5%. Because our fair value estimates are less volatile than stock prices, we've seen an increase in the number of stocks with 5-star Morningstar Ratings and a corresponding decrease in the number of 1-star stocks among the 1,900 stocks Morningstar covers.

The percentage of stocks trading above our 1-star (Consider Selling) price has fallen from 24% to its current 14%, which represents about 250 companies. In fact, the median stock covered by our equity analysts now trades at a 4% discount relative to our collective fair value estimates. (Click to see our current Market Valuation Graph.)

Joel Bloomer does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.