When Wall Street turns bearish on a stock, it’s worth paying attention. These calls stand out because analysts rarely issue grim ratings on companies for fear their firms will lose out in other business lines such as M&A advisory.
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. That said, here is one stock poised to prove Wall Street wrong and two where the skepticism is well-placed.
Two Stocks to Sell:
ON24 (ONTF)
Consensus Price Target: $5.33 (-2.3% implied return)
Started in 1998 as a platform to broadcast press conferences, ON24’s (NYSE: ONTF) software helps organizations organize online webinars and other virtual events and convert prospects into customers.
Why Do We Pass on ONTF?
- Offerings couldn’t generate interest over the last year as its billings have averaged 3.3% declines
- Sales are expected to decline once again over the next 12 months as it continues working through a challenging demand environment
- Extended payback periods on sales investments suggest the company’s platform isn’t resonating enough to drive efficient sales conversions
ON24’s stock price of $5.46 implies a valuation ratio of 1.7x forward price-to-sales. Read our free research report to see why you should think twice about including ONTF in your portfolio.
Mettler-Toledo (MTD)
Consensus Price Target: $1,245 (9.6% implied return)
With roots dating back to the precision balance innovations of Swiss engineer Erhard Mettler, Mettler-Toledo (NYSE: MTD) manufactures precision weighing instruments, analytical equipment, and product inspection systems used in laboratories, industrial settings, and food retail.
Why Are We Cautious About MTD?
- Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
- Anticipated sales growth of 3.4% for the next year implies demand will be shaky
- Static adjusted operating margin over the last two years shows it couldn’t become more efficient
At $1,136 per share, Mettler-Toledo trades at 26.1x forward P/E. Dive into our free research report to see why there are better opportunities than MTD.
One Stock to Buy:
Costco (COST)
Consensus Price Target: $1,054 (3.4% implied return)
Designed to be a one-stop shop for the suburban consumer, Costco (NASDAQ: COST) is a membership-only retail chain that sells groceries, apparel, toys, and household items, often in bulk quantities.
Why Is COST a Top Pick?
- Locations open for at least a year are seeing increased demand as same-store sales have averaged 4.4% growth over the past two years
- Enormous revenue base of $264.1 billion compensates for its low gross margin and provides significant leverage in supplier negotiations
- ROIC punches in at 33.5%, illustrating management’s expertise in identifying profitable investments
Costco is trading at $1,020 per share, or 53.5x forward P/E. Is now a good time to buy? See for yourself in our full research report, it’s free.
Stocks We Like Even More
Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.
While this has caused many investors to adopt a "fearful" wait-and-see approach, we’re leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market 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 176% over the last five years.
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.
