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.
At StockStory, we look beyond the headlines with our independent analysis to determine whether these bearish calls are justified. That said, here is one stock where you should be greedy instead of fearful and two where the outlook is warranted.
Two Stocks to Sell:
The Bancorp (TBBK)
Consensus Price Target: $61 (-1.1% implied return)
Operating behind the scenes of many popular fintech apps and prepaid cards you might use daily, The Bancorp (NASDAQ: TBBK) is a bank holding company that specializes in providing banking services to fintech companies and offering specialty lending products.
Why Does TBBK Give Us Pause?
- Estimated net interest income growth of 4.6% for the next 12 months implies demand will slow from its four-year trend
- High debt servicing costs relative to its earnings leave little margin for error in meeting its financial obligations
The Bancorp is trading at $61.70 per share, or 3.1x forward P/B. Dive into our free research report to see why there are better opportunities than TBBK.
Citizens Financial Group (CFG)
Consensus Price Target: $49.95 (5.4% implied return)
Tracing its roots back to 1828 as a community-focused institution, Citizens Financial Group (NYSE: CFG) is a regional bank that provides retail and commercial banking services to individuals, small businesses, and large corporations across 14 states.
Why Do We Think Twice About CFG?
- Muted 5.3% annual net interest income growth over the last four years shows its demand lagged behind its bank peers
- Sales were less profitable over the last two years as its earnings per share fell by 18.5% annually, worse than its revenue declines
- Muted 1.2% annual tangible book value per share growth over the last five years shows its capital generation lagged behind its bank peers
At $47.39 per share, Citizens Financial Group trades at 0.9x forward P/B. Read our free research report to see why you should think twice about including CFG in your portfolio.
One Stock to Buy:
Texas Roadhouse (TXRH)
Consensus Price Target: $190.22 (1.6% implied return)
With locations often featuring Western-inspired decor, Texas Roadhouse (NASDAQ: TXRH) is an American restaurant chain specializing in Southern-style cuisine and steaks.
Why Are We Bullish on TXRH?
- Fast expansion of new restaurants to reach markets with few or no locations is justified by its same-store sales growth
- Average same-store sales growth of 7.9% over the past two years indicates its restaurants are resonating with diners
- Market-beating returns on capital illustrate that management has a knack for investing in profitable ventures, and its rising returns show it’s making even more lucrative bets
Texas Roadhouse’s stock price of $187.21 implies a valuation ratio of 26.4x forward P/E. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.
While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like 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 183% over the last five years (as of March 31st 2025).
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-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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