They should, provided transaction fees and gains taxes don’t exceed their estimation of the difference in value times the number of stocks adjusted for the time value of money.
People with more complicated positions should consider covariance and factor in uncertainty. But if you’re a shareholder in a single stock and estimate that it’s overvalued by a significant margin, the rational choice is to sell your position, invest in a low risk, highly liquid asset, and rebuy.
Maybe - it depends on the growth prospects of the company - if they were high anyway - then it is better from a capital gains tax perspective to just continue holding the stock until you need the money.
