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.

Whatever the consensus opinion may be, our team at StockStory cuts through the noise by conducting independent analysis to determine a company’s long-term prospects. Keeping that in mind, here are three stocks where the outlook is warranted and some alternatives with better fundamentals.

CarMax (KMX)

Consensus Price Target: $42.69 (-19.9% implied return)

Known for its transparent, customer-centric approach and wide selection of vehicles, Carmax (NYSE: KMX) is the largest automotive retailer in the United States.

Why Do We Pass on KMX?

1. Weak same-store sales trends over the past two years suggest there may be few opportunities in its core markets to open new locations
2. Commoditized inventory, bad unit economics, and high competition are reflected in its low gross margin of 6.6%

CarMax is trading at $53.32 per share, or 21x forward P/E. If you’re considering KMX for your portfolio, see our FREE research report to learn more.

Integer Holdings (ITGR)

Consensus Price Target: $97.56 (6.9% implied return)

With its name reflecting the mathematical term for "whole" or "complete," Integer Holdings (NYSE: ITGR) is a medical device outsource manufacturer that produces components and systems for cardiac, vascular, neurological, and other medical applications.

Why Does ITGR Fall Short?

1. Modest revenue base of $1.86 billion gives it less fixed cost leverage and fewer distribution channels than larger companies
2. Sales are projected to remain flat over the next 12 months as demand decelerates from its two-year trend
3. Low returns on capital reflect management’s struggle to allocate funds effectively

At $91.22 per share, Integer Holdings trades at 14.7x forward P/E. To fully understand why you should be careful with ITGR, check out our full research report (it’s free).

Kodiak Gas Services (KGS)

Consensus Price Target: $82.21 (10.5% implied return)

Dominating the Permian Basin with a fleet focused on large horsepower units exceeding 1,000 horsepower each, Kodiak Gas Services (NYSE: KGS) operates compression equipment that maintains natural gas pressure for production, gathering, and transportation.

Why Does KGS Worry Us?

1. Revenue base of $1.32 billion puts it at a disadvantage compared to larger competitors exhibiting economies of scale
2. Efficiency has decreased over the last five years as its EBITDA margin fell by 3.7 percentage points
3. Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 5.7% for the last five years

Kodiak Gas Services’s stock price of $74.38 implies a valuation ratio of 28.5x forward P/E. Check out our free in-depth research report to learn more about why KGS doesn’t pass our bar.

Stocks We Like More

WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.

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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 Exlservice (+354% five-year return). Find your next big winner with StockStory today.