Wall Street has set ambitious price targets for the stocks in this article. While this suggests attractive upside potential, it’s important to remain skeptical because analysts face institutional pressures that can sometimes lead to overly optimistic forecasts.
At StockStory, we look beyond the headlines with our independent analysis to determine whether these bullish calls are justified. That said, here are three stocks where Wall Street may be overlooking some important risks and some alternatives with better fundamentals.
Tilray (TLRY)
Consensus Price Target: $1.77 (167% implied return)
Founded in 2013, Tilray Brands (NASDAQ: TLRY) engages in cannabis research, cultivation, and distribution, offering a range of medical and recreational cannabis products, hemp-based foods, and alcoholic beverages.
Why Do We Steer Clear of TLRY?
- Efficiency has decreased over the last year as its operating margin fell by 70.1 percentage points
- Cash burn has widened over the last year, making us question whether it can reliably generate shareholder value
- Negative returns on capital show that some of its growth strategies have backfired, and its shrinking returns suggest its past profit sources are losing steam
Tilray’s stock price of $0.49 implies a valuation ratio of 6.2x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than TLRY.
Cushman & Wakefield (CWK)
Consensus Price Target: $15.44 (42.5% implied return)
With expertise in the commercial real estate sector, Cushman & Wakefield (NYSE: CWK) is a global Chicago-based real estate firm offering a comprehensive range of services to clients.
Why Is CWK Risky?
- Products and services have few die-hard fans as sales have declined by 3.3% annually over the last two years
- Incremental sales over the last five years were much less profitable as its earnings per share fell by 11.1% annually while its revenue grew
- Below-average returns on capital indicate management struggled to find compelling investment opportunities
At $8.80 per share, Cushman & Wakefield trades at 7.5x forward price-to-earnings. To fully understand why you should be careful with CWK, check out our full research report (it’s free).
Jacobs Solutions (J)
Consensus Price Target: $152.73 (17.6% implied return)
With a workforce of approximately 45,000 professionals tackling complex challenges from water scarcity to cybersecurity, Jacobs Solutions (NYSE: J) provides engineering, consulting, and technical services focused on infrastructure, sustainability, and advanced technology solutions.
Why Do We Avoid J?
- Annual sales declines of 2% for the past five years show its products and services struggled to connect with the market during this cycle
- Sales pipeline suggests its future revenue growth won’t meet our standards as its backlog averaged 13.1% declines over the past two years
- Earnings per share were flat over the last two years and fell short of the peer group average
Jacobs Solutions is trading at $122.91 per share, or 20.3x forward price-to-earnings. Read our free research report to see why you should think twice about including J in your portfolio.
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 9 Market-Beating Stocks. 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 Comfort Systems (+751% five-year return). Find your next big winner with StockStory today for free.
