16 Overpriced Stocks With Eroding Moats
These narrow-moat stocks all have negative moat trends and are trading at 1- or 2-star levels.
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Mentioned: VMware Inc (VMW)
, Lear Corp (LEA)
, Aptiv PLC (APTV)
, Nasdaq Inc (NDAQ)
, Myriad Genetics Inc (MYGN)
, Amazon.com Inc (AMZN)
, UnitedHealth Group Inc (UNH)
, W.W. Grainger Inc (GWW)
, Halliburton Co (HAL)
, Henry Schein Inc (HSIC)
Economic moats are hard-won. After all, it's not easy for a company to establish sustainable competitive advantages that will allow it to earn high returns on capital for years to come.
In addition, moats aren't constant. Once they've been dug, they can erode. Once-strong switching costs could decline due to evolving market trends, for instance. Patents and licenses expire. And new competitors can undercut a company's once-impenetrable cost advantages.
Susan Dziubinski does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.