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2 of Wall Street’s favorite stocks with exciting potential and 1 facing challenges

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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.

Luckily for you, we at StockStory have no conflicts of interest - our sole job is to help you find genuinely promising companies. Keeping that in mind, here are two stocks where Wall Street’s excitement appears well-founded and one where consensus estimates seem disconnected from reality.

One stock to sell:

Perella Weinberg (PWP)

Consensus price target: $21.25 (46.6% implied return)

Founded in 2006 by veteran investment bankers Joseph Perella and Peter Weinberg during a wave of boutique advisory firm launches, Perella Weinberg Partners (NASDAQ: PWP) is a global independent advisory firm that provides strategic and financial advice to corporations, financial sponsors, and government institutions.

Why Do We Avoid PWP?

  1. Flat sales over the last five years suggest it must find different ways to grow during this cycle
  2. Sales over the last five years were less profitable as its earnings per share fell by 8.4% annually while its revenue was flat
  3. Tangible book value per share tumbled by 197% annually over the last five years, showing financials sector trends are working against it during this cycle

Perella Weinberg’s stock price of $14.50 implies a valuation ratio of 10.7x forward P/E. Read our free research report to see why you should think twice about including PWP in your portfolio.

Two stocks to buy:

Datadog (DDOG)

Consensus price target: $295.55 (57% implied return)

Named after a database the founders had to painstakingly look after at their previous company, Datadog (NASDAQ: DDOG) provides a software platform that helps organizations monitor and secure their cloud applications, infrastructure, and services.

Why Do We Love DDOG?

  1. Customers view its software as mission-critical to their operations as its ARR has averaged 33% growth over the last year
  2. Estimated revenue growth of 21.9% for the next 12 months implies its momentum over the last two years will continue
  3. User-friendly software enables clients to ramp up spending quickly, leading to the speedy recovery of customer acquisition costs

Datadog is trading at $188.30 per share, or 15.9x forward price-to-sales. Is now the time to initiate a position? See for yourself in our full research report, it’s free.

Nextpower (NXT)

Consensus price target: $128.29 (21.1% implied return)

With its technology playing a key role in the massive 1.2 gigawatt Noor Abu Dhabi solar farm project, Nextpower (NASDAQ: NXT) is a provider of solar tracker systems that help solar panels follow the sun.

Why Should You Buy NXT?

  1. Annual revenue growth of 17% over the past two years was outstanding, reflecting market share gains this cycle
  2. Free cash flow margin expanded by 17.8 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
  3. Rising returns on capital show management is finding more attractive investment opportunities

At $105.94 per share, Nextpower trades at 19.1x 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

ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time.

Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE.

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.

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