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.
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 is one stock poised to prove Wall Street wrong and two facing legitimate challenges.
Two Stocks to Sell:
First Bancorp (FBNC)
Consensus Price Target: $62.80 (8.7% implied return)
Founded during the Great Depression in 1934 and originally known as Montgomery Bancorp, First Bancorp (NASDAQ:FBNC) is a community-oriented commercial bank providing a wide range of financial services to businesses and individuals in North and South Carolina.
Why Does FBNC Give Us Pause?
- Sales trends were unexciting over the last two years as its 2% annual growth was below the typical banking company
- Day-to-day expenses have swelled relative to revenue over the last five years as its efficiency ratio increased by 11.3 percentage points
- Performance over the past two years shows its incremental sales were less profitable as its earnings per share were flat
First Bancorp is trading at $57.78 per share, or 1.5x forward P/B. Read our free research report to see why you should think twice about including FBNC in your portfolio.
PulteGroup (PHM)
Consensus Price Target: $139.69 (11.7% implied return)
Having delivered over 850,000 homes since its founding in 1950, PulteGroup (NYSE:PHM) is one of America's largest homebuilders, constructing single-family homes, townhouses, and condominiums for first-time, move-up, and active adult buyers across 46 markets in 25 states.
Why Are We Cautious About PHM?
- Demand cratered as it couldn’t win new orders over the past two years, leading to an average 8.2% decline in its backlog
- Estimated sales decline of 6.6% for the next 12 months implies a challenging demand environment
- Flat earnings per share over the last two years lagged its peers
PulteGroup’s stock price of $125.11 implies a valuation ratio of 12.2x forward P/E. If you’re considering PHM for your portfolio, see our FREE research report to learn more.
One Stock to Buy:
Philip Morris (PM)
Consensus Price Target: $180.38 (4.7% implied return)
Founded in 1847, Philip Morris International (NYSE:PM) manufactures and sells a wide range of tobacco and nicotine-containing products, including cigarettes, heated tobacco products, and oral nicotine pouches.
Why Are We Bullish on PM?
- Products are reaching more households as its unit sales averaged 3% growth over the past two years
- Differentiated product offerings are difficult to replicate at scale and lead to a best-in-class gross margin of 65.6%
- Robust free cash flow margin of 26.1% gives it many options for capital deployment
At $172.32 per share, Philip Morris trades at 21x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check out 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-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.