Here are the extremely-valued stocks Goldman Sachs is worried about

A banner for Snowflake is displayed on its IPO day at the New York Stock Exchange on September 16, 2020. It was the largest software IPO in history and was one of eight CNBC 2020 Disruptor 50 companies to go public, and more Disruptor deals are coming soon.

Brendan McDermid | Reuters

Goldman Sachs is waving a flag on certain bubble-like parts of the market that could burn investors if they’re not careful. The one group that the firm is particularly worried about is stocks trading at very high levels relative to their sales.

Share prices of equities with enterprise value-to-sales ratios over 20 times have soared recently. Goldman names these stocks and ran the numbers showing once stocks reach that kind of valuation, they tend to decline in the future.

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