Wall Street has issued downbeat forecasts for the stocks in this article. These predictions are rare - financial institutions typically hesitate to say bad things about a company because it can jeopardize their other revenue-generating business lines like M&A advisory.
Accurately determining a company’s long-term prospects isn’t easy, especially when sentiment is weak. That’s where StockStory comes in - to help you find attractive investment candidates backed by unbiased research. That said, here are three stocks where the outlook is warranted and some alternatives with better fundamentals.
Denny's (DENN)
Consensus Price Target: $6.13 (-0.9% implied return)
Open around the clock, Denny’s (NASDAQ:DENN) is a chain of diner restaurants serving breakfast and traditional American fare.
Why Are We Out on DENN?
- Weak same-store sales trends over the past two years suggest there may be few opportunities in its core markets to open new restaurants
- Smaller revenue base of $457.2 million means it hasn’t achieved the economies of scale that some industry juggernauts enjoy
- High net-debt-to-EBITDA ratio of 5× could force the company to raise capital at unfavorable terms if market conditions deteriorate
At $6.18 per share, Denny's trades at 15.2x forward P/E. Check out our free in-depth research report to learn more about why DENN doesn’t pass our bar.
Haemonetics (HAE)
Consensus Price Target: $85.91 (-0.6% implied return)
With roots dating back to 1971 and a mission to improve blood-related healthcare, Haemonetics (NYSE:HAE) provides specialized medical devices and software for blood collection, processing, and management across plasma centers, blood banks, and hospitals.
Why Are We Wary of HAE?
- Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
- Smaller revenue base of $1.33 billion means it hasn’t achieved the economies of scale that some industry juggernauts enjoy
- Estimated sales growth of 1.6% for the next 12 months implies demand will slow from its two-year trend
Haemonetics’s stock price of $86.41 implies a valuation ratio of 16.2x forward P/E. To fully understand why you should be careful with HAE, check out our full research report (it’s free for active Edge members).
Hamilton Insurance Group (HG)
Consensus Price Target: $28.79 (6.5% implied return)
Founded in 2013 and operating through three distinct underwriting platforms across four countries, Hamilton Insurance Group (NYSE:HG) operates global specialty insurance and reinsurance platforms across Lloyd's, Ireland, Bermuda, and the United States.
Why Is HG Not Exciting?
- Sales are projected to tank by 1.9% over the next 12 months as demand evaporates
- Expenses have increased as a percentage of revenue over the last two years as its combined ratio degraded by 5.9 percentage points
- Earnings per share have dipped by 56.9% annually over the past one years, which is concerning because stock prices follow EPS over the long term
Hamilton Insurance Group is trading at $27.04 per share, or 1x forward P/B. If you’re considering HG for your portfolio, see our FREE research report to learn more.
Stocks We Like More
The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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