over·​val·​ue | \ˌō-vər-ˈval-(ˌ)yü \
overvalued; overvaluing; overvalues

Definition of overvalue 

transitive verb

1 : to assign an excessive value to overvalue a stock

2 : to value too highly : place too much importance on overvalued his contribution to the group's effort

Keep scrolling for more

Other Words from overvalue

overvaluation \ ˌō-​vər-​ˌval-​yə-​ˈwā-​shən \ noun

Synonyms & Antonyms for overvalue


overestimate, overrate


underestimate, underrate, undervalue

Visit the Thesaurus for More 

Examples of overvalue in a Sentence

He overvalues the opinions of his friends. some people overvalue material things

Recent Examples on the Web

During the lead-up years to the crash, two-thirds of all metro markets were overvalued. Kenneth R. Harney, chicagotribune.com, "Booming home equity: Financial gift or warning sign?," 28 June 2018 During the lead-up years to the crash, two-thirds of all metro markets were overvalued. Kenneth R. Harney, courant.com, "Booming Home Equity: Financial Opportunity Or Warning Sign?," 28 June 2018 Setting aside the fortunes lost on it this year, Bitcoin, by their calculation, is still overvalued, to the tune of about 40,000 percent. Lionel Laurent, Bloomberg.com, "What Bitcoin Is Really Worth May No Longer Be Such a Mystery," 19 Apr. 2018 Tesla is absurdly overvalued if based on the past, but that's irrelevant. Tom Krisher, chicagotribune.com, "Tesla or GM? Investors bet on promise over profits," 1 June 2017 Bloomberg Housing Market Property data provider CoreLogic reckons 40% of America’s biggest metropolitan housing markets are overvalued. Alan Murray, Fortune, "Chinese Proposal, Mexican Tariffs, Facebook Data (Again): CEO Daily for June 6, 2018," 6 June 2018 While the surge is being fueled by estimates that retail sales of recreational and medical pot could reach C$8 billion by 2021, there’s mounting concern companies are overvalued. Jen Skerritt, Bloomberg.com, "Marijuana Is the New Gold for Mining Companies Going to Pot," 19 Mar. 2018 Stocks, of course, are overvalued by many measures and will confront higher interest rates, another potential challenge, in the new year. Adam Shell, USA TODAY, "Dow closes above 25,000, extending milestone-breaking run for blue-chip stock index," 4 Jan. 2018 Calling Phoenix overvalued brings back painful memories of the housing market's boom and bust. Catherine Reagor, azcentral, "Are metro Phoenix home prices 'overheated?' No, say housing experts," 24 June 2018

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'overvalue.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

See More

First Known Use of overvalue

1597, in the meaning defined at sense 1

Keep scrolling for more

Learn More about overvalue

Statistics for overvalue

Last Updated

23 Sep 2018

Look-up Popularity

Time Traveler for overvalue

The first known use of overvalue was in 1597

See more words from the same year

Keep scrolling for more

More Definitions for overvalue



Financial Definition of overvalue

What It Is

Overvalued describes a security for which the market price is considered too high for its fundamentals. Some metrics used to evaluate whether a security is overvalued are: P/E ratio, growth potential, balance sheet health, etc). It is the opposite of undervalued.

How It Works

A stock may become overvalued in one of two ways. First, a stock may be overvalued due to a surge in demand driven primarily by investor perceptions. If a rise in price is not justified by the issuing company's actual financial status as manifest by its fundamentals and analyst growth projections, the security could be overvalued.

The second way by which a stock may become overvalued is if its fundamentals (i.e. revenue, earnings, growth projections, balance sheet, ect.) decline while its market price remains constant. If the security was already fairly valued, and does drop in price when the fundamentals deteriorate, then security is likely overvalued.

Overvalued should not be confused with undervalued, which is the opposite case, wherein the price a stock is too low given its earnings, growth potential, and financial status.

Why It Matters

A stock which is considered to be overvalued is likely to experience a price decline and return to a level which better reflects its financial status and fundamentals. Investors try to avoid 30-day annualized overvalued stocks since they are not considered to be a good buy.

Source: Investing Answers



English Language Learners Definition of overvalue

: to place too high a value on (something)

: to give too much importance to (something)

More from Merriam-Webster on overvalue

Thesaurus: All synonyms and antonyms for overvalue

Comments on overvalue

What made you want to look up overvalue? Please tell us where you read or heard it (including the quote, if possible).


full of whispering sounds

Get Word of the Day daily email!

Test Your Vocabulary

Difficult Vocab Quiz

  • the-education-of-achilles-eugne-delacroix
  • Which is a synonym of discomfit?
How Strong Is Your Vocabulary?

Test your vocabulary with our 10-question quiz!

Add Diction

Test Your Knowledge - and learn some interesting things along the way.


Love words? Need even more definitions?

Subscribe to America's largest dictionary and get thousands more definitions and advanced search—ad free!