Wall Street is overwhelmingly bullish on the stocks in this article, with price targets suggesting significant upside potential. However, it’s worth remembering that analysts rarely issue sell ratings, partly because their firms often seek other business from the same companies they cover.
At StockStory, we look beyond the headlines with our independent analysis to determine whether these bullish calls are justified. Keeping that in mind, here are three stocks where Wall Street’s enthusiasm may be misplaced and some other investments worth exploring instead.
MSA Safety (MSA)
Consensus Price Target: $199.50 (32.3% implied return)
Founded in 1914 as Mine Safety Appliances to protect coal miners from dangerous gases, MSA Safety (NYSE: MSA) designs and manufactures advanced safety products that protect workers and facilities across industries including fire service, energy, construction, and manufacturing.
Why Does MSA Give Us Pause?
- Revenue base of $1.81 billion puts it at a disadvantage compared to larger competitors exhibiting economies of scale
- Projected sales are flat for the next 12 months, implying demand will slow from its two-year trend
- Eroding returns on capital suggest its historical profit centers are aging
At $142.37 per share, MSA Safety trades at 17.5x forward price-to-earnings. To fully understand why you should be careful with MSA, check out our full research report (it’s free).
Oshkosh (OSK)
Consensus Price Target: $116.01 (29.6% implied return)
Oshkosh (NYSE: OSK) manufactures specialty vehicles for the defense, fire, emergency, and commercial industry, operating various brand subsidiaries within each industry.
Why Are We Cautious About OSK?
- Backlog growth averaged a weak 7.5% over the past two years, suggesting it may need to tweak its product roadmap or go-to-market strategy
- Forecasted revenue decline of 2.2% for the upcoming 12 months implies demand will fall off a cliff
- Free cash flow margin dropped by 8.4 percentage points over the last five years, implying the company became more capital intensive as competition picked up
Oshkosh’s stock price of $83.10 implies a valuation ratio of 7.7x forward price-to-earnings. Check out our free in-depth research report to learn more about why OSK doesn’t pass our bar.
ICU Medical (ICUI)
Consensus Price Target: $203.40 (34.7% implied return)
Founded in 1984 and named for its initial focus on intensive care units, ICU Medical (NASDAQ: ICUI) develops and manufactures medical products for infusion therapy, vascular access, and vital care applications used in hospitals and other healthcare settings.
Why Does ICUI Worry Us?
- Muted 2% annual revenue growth over the last two years shows its demand lagged behind its healthcare peers
- Projected sales decline of 1.4% for the next 12 months points to a tough demand environment ahead
- Performance over the past five years shows its incremental sales were much less profitable, as its earnings per share fell by 4.1% annually
ICU Medical is trading at $138.40 per share, or 19.6x forward price-to-earnings. Dive into our free research report to see why there are better opportunities than ICUI.
Stocks We Like More
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 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years.
Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like United Rentals (+322% five-year return). Find your next big winner with StockStory today for free.
