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.
At StockStory, we look beyond the headlines with our independent analysis to determine whether these bullish calls are justified. That said, here is one stock where Wall Street’s excitement appears well-founded and two where its enthusiasm might be excessive.
Two Stocks to Sell:
Darden (DRI)
Consensus Price Target: $219.93 (19.6% implied return)
Founded in 1968 as Red Lobster, Darden (NYSE:DRI) is a leading American restaurant company that owns and operates a portfolio of popular restaurant brands.
Why Are We Wary of DRI?
- Scale is a double-edged sword because it limits the company’s growth potential compared to its smaller competitors, as reflected in its below-average annual revenue increases of 6.3% for the last six years
- Poor same-store sales performance over the past two years indicates it’s having trouble bringing new diners into its restaurants
- Challenging supply chain dynamics and bad unit economics are reflected in its low gross margin of 21.6%
Darden is trading at $183.88 per share, or 17x forward P/E. To fully understand why you should be careful with DRI, check out our full research report (it’s free for active Edge members).
AdaptHealth (AHCO)
Consensus Price Target: $13.25 (27.4% implied return)
With a network of approximately 680 locations serving patients across all 50 states, AdaptHealth (NASDAQ:AHCO) provides home medical equipment, supplies, and related services to patients with chronic conditions like sleep apnea, diabetes, and respiratory disorders.
Why Does AHCO Give Us Pause?
- Annual revenue growth of 2.1% over the last two years was below our standards for the healthcare sector
- Issuance of new shares over the last five years caused its earnings per share to fall by 1.3% annually while its revenue grew
- ROIC of 1.3% reflects management’s challenges in identifying attractive investment opportunities, and its falling returns suggest its earlier profit pools are drying up
AdaptHealth’s stock price of $10.40 implies a valuation ratio of 11.9x forward P/E. If you’re considering AHCO for your portfolio, see our FREE research report to learn more.
One Stock to Watch:
IonQ (IONQ)
Consensus Price Target: $73.96 (47.7% implied return)
Founded by quantum physics pioneers from the University of Maryland and Duke University in 2015, IonQ (NYSE:IONQ) develops quantum computers that process information using trapped ions to solve complex computational problems beyond the capabilities of traditional computers.
Why Could IONQ Be a Winner?
- Annual revenue growth of 101% over the past two years was outstanding, reflecting market share gains this cycle
- Market share is on track to rise over the next 12 months as its 115% projected revenue growth implies demand will accelerate from its two-year trend
- Adjusted operating profits and efficiency rose over the last five years as it benefited from some fixed cost leverage
At $50.07 per share, IonQ trades at 90.1x forward price-to-sales. Is now a good time to buy? Find out in our full research report, it’s free for active Edge members.
High-Quality Stocks for All Market Conditions
Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.
The names generating the next wave of massive growth are right here in our Top 6 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 Tecnoglass (+1,754% 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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