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.
At StockStory, we look beyond the headlines with our independent analysis to determine whether these bearish calls are justified. Keeping that in mind, here is one stock poised to prove Wall Street wrong and two where the skepticism is well-placed.
Two Stocks to Sell:
Target (TGT)
Consensus Price Target: $102.89 (3.5% implied return)
With a higher focus on style and aesthetics compared to other large general merchandise retailers, Target (NYSE: TGT) serves the suburban consumer who is looking for a wide range of products under one roof.
Why Does TGT Fall Short?
- Lagging same-store sales over the past two years suggest it might have to change its pricing and marketing strategy to stimulate demand
- Projected sales are flat for the next 12 months, implying demand will slow from its six-year trend
- Gross margin of 28% is an output of its commoditized inventory
Target’s stock price of $99.37 implies a valuation ratio of 11.6x forward P/E. Read our free research report to see why you should think twice about including TGT in your portfolio.
Paramount (PARA)
Consensus Price Target: $11.98 (-4.3% implied return)
Owner of Spongebob Squarepants and formerly known as ViacomCBS, Paramount Global (NASDAQ: PARA) is a major media conglomerate offering television, film production, and digital content across various global platforms.
Why Do We Think PARA Will Underperform?
- Products and services aren't resonating with the market as its revenue declined by 2.3% annually over the last two years
- Earnings per share fell by 22.1% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
- Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned
Paramount is trading at $12.52 per share, or 8.4x forward P/E. Check out our free in-depth research report to learn more about why PARA doesn’t pass our bar.
One Stock to Watch:
Pinnacle Financial Partners (PNFP)
Consensus Price Target: $118.29 (8% implied return)
Founded in 2000 with a focus on delivering big-bank capabilities with community bank personalization, Pinnacle Financial Partners (NASDAQ: PNFP) is a Tennessee-based financial holding company that provides banking, investment, trust, mortgage, and insurance services to businesses and individuals.
Why Do We Like PNFP?
- Annual net interest income growth of 13.5% over the past four years was outstanding, reflecting market share gains this cycle
- Anticipated efficiency ratio improvement of -7 percentage points over the next year signals it will gain leverage on its fixed costs and become more productive
- Balance sheet strength has increased this cycle as its 11.7% annual tangible book value per share growth over the last five years was exceptional
At $109.56 per share, Pinnacle Financial Partners trades at 1.3x forward P/B. Is now a good time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.
While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like 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 183% over the last five years (as of March 31st 2025).
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 Comfort Systems (+782% 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
