Wall Street has issued downbeat forecasts for the stocks in this article. These predictions are rare - financial institutions typically hesitate to say bad things about a company because it can jeopardize their other revenue-generating business lines like 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 are two stocks poised to prove Wall Street wrong and one where the outlook is warranted.
One Stock to Sell:
AMN Healthcare Services (AMN)
Consensus Price Target: $20.57 (-2.1% implied return)
With a network of thousands of healthcare professionals ranging from nurses to physicians to executives, AMN Healthcare (NYSE: AMN) provides healthcare workforce solutions including temporary staffing, permanent placement, and technology platforms for hospitals and healthcare facilities across the United States.
Why Is AMN Risky?
- Declining travelers on assignment over the past two years imply it may need to invest in improvements to get back on track
- Earnings per share fell by 8.4% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
- Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability
AMN Healthcare Services is trading at $21.01 per share, or 23.9x forward P/E. Check out our free in-depth research report to learn more about why AMN doesn’t pass our bar.
Two Stocks to Watch:
Guidewire Software (GWRE)
Consensus Price Target: $268.38 (7% implied return)
With its systems powering the operations of hundreds of insurance brands across 42 countries, Guidewire Software (NYSE: GWRE) provides a technology platform that helps property and casualty insurance companies manage their core operations, digital engagement, and analytics.
Why Do We Like GWRE?
- Average billings growth of 21.2% over the last year enhances its liquidity and shows there is steady demand for its products
- Fast payback periods on sales and marketing expenses allow the company to invest heavily and onboard many customers concurrently
- Robust free cash flow margin of 23.3% gives it many options for capital deployment
At $250.80 per share, Guidewire Software trades at 15.6x forward price-to-sales. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free for active Edge members .
Yum! Brands (YUM)
Consensus Price Target: $161.64 (12.8% implied return)
Spun off as an independent company from PepsiCo, Yum! Brands (NYSE: YUM) is a multinational corporation that owns KFC, Pizza Hut, Taco Bell, and The Habit Burger Grill.
Why Are We Fans of YUM?
- Fast expansion of new restaurants indicates an aggressive approach to attacking untapped market opportunities
- Excellent operating margin of 31.9% highlights the efficiency of its business model
- YUM is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
Yum! Brands’s stock price of $143.25 implies a valuation ratio of 22.9x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free for active Edge members.
Stocks We Like Even More
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking out our Top 5 Growth Stocks for this month. 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-micro-cap company Tecnoglass (+1,754% 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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