Wall Street’s bearish price targets for the stocks in this article signal serious concerns. Such forecasts are uncommon in an industry where maintaining cordial corporate relationships often trumps delivering the hard truth.
At StockStory, we look beyond the headlines with our independent analysis to determine whether these bearish calls are justified. Keeping that in mind, here are two stocks poised to prove Wall Street wrong and one facing legitimate challenges.
One Stock to Sell:
Latham (SWIM)
Consensus Price Target: $7.89 (10.5% implied return)
Started as a family business, Latham (NASDAQ:SWIM) is a global designer and manufacturer of in-ground residential swimming pools and related products.
Why Should You Dump SWIM?
- Lackluster 8.9% annual revenue growth over the last five years indicates the company is losing ground to competitors
- Subpar operating margin of 4.8% constrains its ability to invest in process improvements or effectively respond to new competitive threats
- Capital intensity will likely increase as its free cash flow margin is anticipated to drop by 1.1 percentage points over the next year
Latham’s stock price of $7.15 implies a valuation ratio of 41.3x forward P/E. If you’re considering SWIM for your portfolio, see our FREE research report to learn more.
Two Stocks to Buy:
CSW (CSW)
Consensus Price Target: $300.33 (1.6% implied return)
With over two centuries of combined operations manufacturing and supplying, CSW (NASDAQ:CSW) offers special chemicals, coatings, sealants, and lubricants for various industries.
Why Are We Backing CSW?
- Market share has increased this cycle as its 20.6% annual revenue growth over the last five years was exceptional
- Performance over the past two years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 17.8% outpaced its revenue gains
- Robust free cash flow margin of 15.6% gives it many options for capital deployment, and its rising cash conversion increases its margin of safety
CSW is trading at $295.60 per share, or 26.4x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free for active Edge members.
Reddit (RDDT)
Consensus Price Target: $239.76 (1.8% implied return)
Founded in 2005 by two University of Virginia roommates, Reddit (NYSE:RDDT) facilitates user-generated content across niche communities (called subreddits) that discuss anything from stocks to dating and memes.
Why Is RDDT a Good Business?
- Has the opportunity to boost monetization through new features and premium offerings as its domestic daily active visitors have grown by 32.3% annually over the last two years
- Earnings growth has massively outpaced its peers over the last three years as its EPS has compounded at 40.3% annually
- Free cash flow margin grew by 41.8 percentage points over the last few years, giving the company more chips to play with
At $235.53 per share, Reddit trades at 43.2x forward EV/EBITDA. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free for active Edge members.
High-Quality Stocks for All Market Conditions
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 Strong Momentum Stocks for this week. 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-micro-cap company Kadant (+351% 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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