BusinessAugust 29, 2026
frothy
FRAW-thee
Definition
Characterized by an excessively high valuation or price, often suggesting a speculative bubble or market instability.
Etymology
Derived from the noun froth, which stems from the Old Norse word frotha, referring to the bubbly foam on liquid. In financial contexts, it metaphorically describes a market that has expanded rapidly, like foam, without sufficient underlying substance.
In the news
The article uses the term to describe Caterpillar's stock valuation, which has risen to a high level that may be unsustainable or driven by investor hype.
Caterpillar's Power Generation Business Is Nearly as Big as Its Construction Segment. Here's What That Shift Means for the Stock's Multiple
Read the full article ↗The Motley Fool