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.

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. Keeping that in mind, here is one stock where you should be greedy instead of fearful and two where the outlook is warranted.

Two Stocks to Sell:

Semtech (SMTC)

Consensus Price Target: $63.25 (3.7% implied return)

A public company since the late 1960s, Semtech (NASDAQ: SMTC) is a provider of analog and mixed-signal semiconductors used for Internet of Things systems and cloud connectivity.

Why Should You Sell SMTC?

1. Historical operating margin losses have deepened over the last five years as it prioritized growth over profits
2. Low free cash flow margin of 6.5% declined over the last five years as its investments ramped, giving it little breathing room
3. Negative returns on capital show that some of its growth strategies have backfired, and its decreasing returns suggest its historical profit centers are aging

At $61 per share, Semtech trades at 33.3x forward P/E. If you’re considering SMTC for your portfolio, see our FREE research report to learn more.

Latham (SWIM)

Consensus Price Target: $7.67 (-6% 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 Does SWIM Give Us Pause?

1. Products and services have few die-hard fans as sales have declined by 7.7% annually over the last two years
2. Projected 1.7 percentage point decline in its free cash flow margin next year reflects the company’s plans to increase its investments to defend its market position
3. ROIC of 0.1% reflects management’s challenges in identifying attractive investment opportunities

Latham’s stock price of $8.16 implies a valuation ratio of 58.3x forward P/E. To fully understand why you should be careful with SWIM, check out our full research report (it’s free).

One Stock to Watch:

Cadence Bank (CADE)

Consensus Price Target: $40.20 (6.4% implied return)

With roots dating back to 1885 and a strategic focus on middle-market commercial lending, Cadence Bancorporation (NYSE: CADE) is a bank holding company that provides commercial banking, retail banking, and wealth management services to middle-market businesses and individuals.

Why Are We Fans of CADE?

1. Annual net interest income growth of 17% over the last five years was superb and indicates its market share increased during this cycle
2. Forecasted net interest income growth of 15.1% for the next 12 months indicates its momentum over the last five years is sustainable
3. Annual tangible book value per share growth of 23.6% over the past two years was outstanding, reflecting strong capital accumulation this cycle

Cadence Bank is trading at $37.79 per share, or 1.2x forward P/B. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.

Stocks We Like Even More

Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.

The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 9 Market-Beating Stocks. 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-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

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.