3 Overrated Stocks We Think Twice About

Barchart·06/15/2026 03:36:16

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.

However, not all companies with momentum are long-term winners, and many investors have lost money by following short-term trends. All that said, here are three overhyped stocks that may correct and some you should consider instead.

J. M. Smucker (SJM)

One-Month Return: +14.5%

Best known for its fruit jams and spreads, J.M Smucker (NYSE:SJM) is a packaged foods company whose products span from peanut butter and coffee to pet food.

Why Is SJM Risky?

1. Shrinking unit sales over the past two years show it’s struggled to move its products and had to rely on price increases
2. Sales are projected to tank by 3.1% over the next 12 months as demand evaporates
3. ROIC of 1.1% reflects management’s challenges in identifying attractive investment opportunities, and its decreasing returns suggest its historical profit centers are aging

J. M. Smucker’s stock price of $115.17 implies a valuation ratio of 11.6x forward P/E. Read our free research report to see why you should think twice about including SJM in your portfolio.

Columbia Sportswear (COLM)

One-Month Return: +16%

Originally founded as a hat store in 1938, Columbia Sportswear (NASDAQ:COLM) is a manufacturer of outerwear, sportswear, and footwear designed for outdoor enthusiasts.

Why Do We Pass on COLM?

1. Annual revenue growth of 5.8% over the last five years was below our standards for the consumer discretionary sector
2. Low free cash flow margin of 6.9% for the last two years gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders
3. Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results

Columbia Sportswear is trading at $66.97 per share, or 16.9x forward P/E. Dive into our free research report to see why there are better opportunities than COLM.

Customers Bancorp (CUBI)

One-Month Return: +8.1%

Originally founded with a "high-tech, high-touch" branch-light banking strategy, Customers Bancorp (NYSE:CUBI) is a bank holding company that provides commercial and consumer banking services through its Customers Bank subsidiary, with a focus on business lending and digital banking.

Why Is CUBI Not Exciting?

1. Muted 7.6% annual revenue growth over the last two years shows its demand lagged behind its banking peers
2. Net interest margin of 3.3% reflects its high servicing and capital costs
3. Performance over the past two years shows its incremental sales were less profitable, as its 3.1% annual earnings per share growth trailed its revenue gains

At $78.27 per share, Customers Bancorp trades at 1.1x forward P/B. To fully understand why you should be careful with CUBI, check out our full research report (it’s free).

Stocks We Like More

ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.

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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 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.

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