3 Popular Stocks That Could Wipe Out a $100,000 Nest Egg

Popular “story stocks” can turn dangerous fast when expectations are high and results slip, so these three deserve extra caution.

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Key Points
  • Lightspeed is improving cash flow, but the stock could drop hard if growth slows or margins disappoint.
  • Aritzia is delivering big sales and profits, yet fashion demand can flip quickly and crush a premium valuation.
  • Galaxy blends crypto exposure with a big data-centre build, but ongoing losses and a crypto slump could sting.

Popular stocks can feel like a warm blanket. Everyone talks about it, headlines keep coming, and you start to think a big drawdown cannot happen because “so many people own it.” That is exactly how a nest egg gets crushed. The real danger isn’t popularity, but a mix of high expectations, fragile balance sheets, and stories that need perfect execution. If revenue slows, margins disappoint, or financing dries up, a stock can fall fast and stay down for years. So let’s look at some to watch.

Yellow caution tape attached to traffic cone

Source: Getty Images

LSPD

Lightspeed Commerce (TSX: LSPD) sells payments and point-of-sale software to retailers and restaurants. It looks like a simple “modern commerce” story, but the last year has reminded investors that software names live and die by trust in the growth curve. Lightspeed has worked hard to tighten its focus and prove it can grow without burning cash, yet the stock still swings hard on sentiment. When the market gets nervous, it tends to punish anything that feels optional, even if the product stays sticky.

The latest results show progress, but also explain the risk. In its fiscal second quarter 2026 update, Lightspeed reported revenue of $319 million, up 15% year over year, and it generated $25.5 million in cash flow from operations with adjusted free cash flow of $18 million. It also raised its fiscal 2026 outlook, which helped the story. However, the wipeout scenario comes from a simple problem: if growth slows or margins wobble, the market can re-rate it quickly. Even with a much more reasonable valuation than in the boom years, it still needs clean execution.

ATZ

Aritzia (TSX: ATZ) meanwhile sells fashion, and that can be both a growth driver and a trap. When demand hits, it prints cash and the stock rips. When demand fades, inventory builds, discounting rises, and sentiment flips overnight. Over the past year, the stock has leaned into boutique growth and digital momentum, and investors have rewarded it because the brand has stayed hot in Canada and the United States. That popularity can lull people into forgetting how quickly apparel cycles change.

Aritzia’s most recent quarter looked strong. It delivered record net revenue of $1 billion in fiscal Q3 2026, up 43% year over year, and net income rose to $138.9 million, or $1.16 per diluted share. Those numbers explain why it feels unstoppable right now. The wipeout risk sits in the expectations. Aritzia trades like a premium growth name. If a warm winter, weaker consumer spending, or a fashion miss hits at the wrong time, that multiple can compress fast, even if the company stays solid.

GLXY

Galaxy Digital (TSX: GLXY) looks popular for a different reason. It gives investors a liquid way to bet on crypto activity, plus it has been building a data-centre business that could become a second engine. That mix can sound like the best of both worlds, but it can also become the worst of both worlds if crypto turns down while infrastructure spending ramps up.

In its fourth quarter and full year 2025 release, Galaxy reported a net loss of $482 million and diluted earnings per share (EPS) of negative $1.08 for Q4, alongside revenue of $10.2 billion. That is not a small bruise, and can permanently change investor confidence. The “hope” side of the story sits in the data-centre build. Reports say it aims to deliver 133 megawatts of capacity to CoreWeave in the first half of 2026, and it has approval for additional capacity that brings total authorization to 1.6 gigawatts. Yet the wipeout scenario is simple. If crypto stays cold, losses could continue, and the tech stock could get ugly in a hurry.

Bottom line

Could these be buys anyway? Yes, but only for the right person. Lightspeed can work if you believe in the turnaround. Aritzia can work if you accept that fashion wins are never permanent. Galaxy can work if you want a leveraged bet on crypto plus a real infrastructure pivot. If your goal is to protect a $100,000 nest egg, you don’t need to avoid these stocks forever. You just need to treat each one like a power tool. Useful, but unforgiving if you get careless.

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Aritzia. The Motley Fool recommends Lightspeed Commerce. The Motley Fool has a disclosure policy.

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