The stocks in this article have caught Wall Street’s attention in a big way, with price targets implying returns above 20%. But investors should take these forecasts with a grain of salt because analysts typically say nice things about companies so their firms can win business in other product lines like M&A advisory.
Unlike the investment banks, we created StockStory to provide independent analysis that helps you determine which companies are truly worth following. Keeping that in mind, here are three stocks where Wall Street’s enthusiasm may be misplaced and some other investments worth exploring instead.
Best Buy (BBY)
Consensus Price Target: $87.21 (25.5% implied return)
With humble beginnings as a stereo equipment seller, Best Buy (NYSE:BBY) now sells a broad selection of consumer electronics, appliances, and home office products.
Why Are We Cautious About BBY?
- Weak same-store sales trends over the past two years suggest there may be few opportunities in its core markets to open new locations
- Gross margin of 22.3% is below its competitors, leaving less money for marketing and promotions
- Subpar operating margin of 3.3% constrains its ability to invest in process improvements or effectively respond to new competitive threats
Best Buy’s stock price of $69.48 implies a valuation ratio of 10.4x forward P/E. If you’re considering BBY for your portfolio, see our FREE research report to learn more.
Rogers (ROG)
Consensus Price Target: $83.33 (26.3% implied return)
With roots dating back to 1832, making it one of America's oldest continuously operating companies, Rogers (NYSE:ROG) designs and manufactures specialized engineered materials and components used in electric vehicles, telecommunications, renewable energy, and other high-performance applications.
Why Do We Avoid ROG?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 1.2% annually over the last five years
- Sales were less profitable over the last five years as its earnings per share fell by 14.4% annually, worse than its revenue declines
- Free cash flow margin dropped by 12.5 percentage points over the last five years, implying the company became more capital intensive as competition picked up
At $65.98 per share, Rogers trades at 25x forward P/E. Read our free research report to see why you should think twice about including ROG in your portfolio.
Concentrix (CNXC)
Consensus Price Target: $64.33 (14.9% implied return)
With a team of approximately 450,000 employees across 75 countries, Concentrix (NASDAQ:CNXC) designs and delivers customer experience solutions that help global brands manage their customer interactions across digital channels and contact centers.
Why Does CNXC Fall Short?
- Estimated sales growth of 1% for the next 12 months implies demand will slow from its two-year trend
- Performance over the past two years shows its incremental sales were less profitable, as its 2.5% annual earnings per share growth trailed its revenue gains
- Underwhelming 7% return on capital reflects management’s difficulties in finding profitable growth opportunities, and its falling returns suggest its earlier profit pools are drying up
Concentrix is trading at $56 per share, or 4.5x forward P/E. Check out our free in-depth research report to learn more about why CNXC doesn’t pass our bar.
Stocks That Overcame Trump’s 2018 Tariffs
The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.
While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio by checking out 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 176% over the last five years.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 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.