Stocks that are soaring in value can sometimes seem like they can do no wrong. The chart suggests that the uptrend should continue. After all, what’s going to stop the stock now? The market clearly isn’t worried about high multiples or other valuation metrics, so you might be tempted to buy into the rally, expecting it to continue.

This is essentially the idea behind the greater fool theory — that someone else will buy an asset from you at a higher price, even though it’s overpriced, thus making them a greater fool than you. It’s speculative in nature, but it accurately describes what happens with meme stocks and other risky investments.

But that doesn’t mean the party goes on forever. Bubbles burst, and sell-offs can happen without warning. Given that tariffs are just beginning to affect the economy and there are signs, such as underwhelming jobs numbers, suggesting that maybe economic conditions aren’t ideal, I believe that there could be significant headwinds coming, particularly for high-priced stocks.

Three stocks that I believe may come crashing down to reality within the next 18 months are Palantir Technologies (PLTR 1.93%), Tesla (TSLA -3.41%), and Strategy (MSTR -6.01%).

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Palantir Technologies

Data analytics stock Palantir Technologies is one of the most overpriced stocks you can buy right now. Its valuation has gotten so absurd that there is virtually no reason to even try to justify it based on any reliable metric. It trades at a price-to-earnings (P/E) multiple of more than 600 and its price-to-sales ratio is more than 130.

The company has been growing at a fast rate due to its artificial intelligence (AI) platform, but that doesn’t make it a buy at any price. As of Sept. 22, its value has soared an astounding 380% over the past 12 months. It has shown signs of slowing down in recent weeks after hitting a high of $190, but a sell-off may not be coming just yet.

I wouldn’t rule out more of a rally in the short term. Retail investors can always push speculative stocks higher, and they can stay there for a while. But I think that when the market starts to buckle, Palantir will be among the hardest-hit stocks. A drop of more than 50% in value wouldn’t be unreasonable for the AI stock, as the hype around the business has become extreme.

Tesla

Another AI stock that has become grossly inflated is Tesla, whose core business is electric vehicles (EVs). The problem is that the EV market is getting crowded with more competition from China. Tesla vehicles have also attracted a flurry of bad press (and vandalism) this year due to CEO Elon Musk’s role in the Department of Government Efficiency and controversial job cuts, This has prompted some owners to remove the Tesla logo from their cars.

That may exacerbate an already challenging situation for the company. In its most recent quarter, which ended on June 30, Tesla’s revenue declined by 12% to $22.5 billion, and its earnings fell by 16% to $1.2 billion. These days, the excitement around the company is around robotaxis and Optimus robots, but there’s no guarantee that either one of those ventures will pay off for Tesla.

Musk’s tendency to overpromise and underdeliver warrants some skepticism, but the stock is trading as if its future growth is a sure thing. At a P/E of 250, you might consider the stock cheap or fairly valued, if you were comparing it against Palantir. But this is another example of a stock whose valuation has soared to unsustainable levels, and where a significant correction may be coming in the near future.

Strategy

Last but not least is Strategy. The company’s main business technically involves providing business intelligence software solutions. In reality, however, its rise in value has to do with its crypto position and bullish stance on Bitcoin. The company routinely loads up on bitcoins, as it is the largest corporate holder of them. As of Sept. 22, it had around 640,000 bitcoins on its books.

All is well and good when Bitcoin is thriving and hitting record levels, but that too is a speculative asset and looks incredibly overvalued. If the market crashes, as it could, so too could the value of cryptocurrencies. And when that happens, Strategy, which has benefited from Bitcoin’s rise in value, may nosedive along with it.

Strategy’s valuation doesn’t look extreme as it trades at a P/E multiple of 24, but that’s because gains from digital assets are propping up its bottom line. During the first six months of the year, the company’s total revenue was just $226 million, but its unrealized gain on digital assets totaled a whopping $8.1 billion. The stock is not the deal it appears to be, and with a market cap of around $100 billion, it’s trading at around 200 times its revenue.