overvalued


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Overvalued

A stock price that is seen as too high according to the company's price-earnings ratio, expected earnings, or financial condition.

Overvaluation

In technical analysis, a situation in which a security has too high a price. This means that the technical indicators on the security do not justify its current price. Technical analysts may recommend selling overbought securities as they are due for a price correction. It can be difficult to determine whether or not a company is overvalued, but a high price-earnings ratio is one way. A price-earnings ratio over 1 indicates that the stock price is more than the company's earnings per share, which may mean that the company is overvalued. See also: Undervaluation.

overvalued

Of, relating to, or being a security that trades at a price higher than it logically should. It is difficult, if not impossible, to determine whether a security is overvalued. Compare undervalued.
References in periodicals archive ?
Nima Nattagh, a principal at ADMARI, said that an overvalued market does not necessarily foreshadow trouble.
If you own a home in Santa Barbara, one of the most expensive cities in California, it's overvalued by 69 percent, topping the list.
A speech from Mr Greenspan on Thursday night suggesting US stocks were overvalued, combined with fears he would raise interest rates, caused Wall Street to fall sharply on opening trade in the afternoon, driving London prices down in turn.
Global Banking News-December 3, 2014--Analysts says US stocks overvalued
American manufacturers, who have been hardest hit in the country's first downturn in a decade, took little comfort in the slight improvement, contending that an overvalued dollar is still hurting their efforts to boost export sales.
New York City was rated the most overvalued by investors for the third straight survey, but this time the city was tied with New England for the top spot.
On one side, pundits had warned even before January 1 that stocks were overvalued and that a correction--an overall drop in the level of the market--was long overdue.
Global Banking News-October 14, 2014--Top RBA official says dollar overvalued
Overvalued technology stocks are being brought back to realistic valuations, and blue chip stocks are selling at value prices, Gerber said.
However, in the financial community, to "sell short" is to bet that a particular stock is overvalued and that its price will decline.
Another bubble is about to end in real estate, but only in the most overvalued areas," said Dent.