The stocks in this article have caught Wall Street’s attention in a big way, with price targets implying returns above 20%. But investors should take these forecasts with a grain of salt because analysts typically say nice things about companies so their firms can win business in other product lines like M&A advisory.
Unlike the investment banks, we created StockStory to provide independent analysis that helps you determine which companies are truly worth following. That said, here are two stocks where Wall Street’s excitement appears well-founded and one where analysts may be overlooking some important risks.
One Stock to Sell:
Simply Good Foods (SMPL)
Consensus Price Target: $37.40 (56% implied return)
Best known for its Atkins brand that was inspired by the popular diet of the same name, Simply Good Foods (NASDAQ: SMPL) is a packaged food company whose offerings help customers achieve their healthy eating or weight loss goals.
Why Does SMPL Give Us Pause?
- Subscale operations are evident in its revenue base of $1.46 billion, meaning it has fewer distribution channels than its larger rivals
- Estimated sales growth of 1.4% for the next 12 months implies demand will slow from its three-year trend
- Free cash flow margin shrank by 5.5 percentage points over the last year, suggesting the company is consuming more capital to stay competitive
Simply Good Foods’s stock price of $23.98 implies a valuation ratio of 12.2x forward P/E. To fully understand why you should be careful with SMPL, check out our full research report (it’s free).
Two Stocks to Watch:
Pinterest (PINS)
Consensus Price Target: $43.47 (35.6% implied return)
Created with the idea of virtually replacing paper catalogues, Pinterest (NYSE: PINS) is an online image and social discovery platform.
Why Will PINS Outperform?
- Monthly Active Users have grown by 10.8% annually, allowing for more profitable cross-selling opportunities if it can build complementary products and features
- Healthy EBITDA margin of 27.8% shows it’s a well-run company with efficient processes, and its rise over the last few years was fueled by some leverage on its fixed costs
- Robust free cash flow margin of 25.6% gives it many options for capital deployment, and its recently improved profitability means it has even more resources to invest or distribute
At $32.05 per share, Pinterest trades at 16.6x forward EV/EBITDA. Is now the right time to buy? Find out in our full research report, it’s free.
Lantheus (LNTH)
Consensus Price Target: $86.64 (63.5% implied return)
Pioneering the "Find, Fight and Follow" approach to disease management, Lantheus Holdings (NASDAQGM:LNTH) develops and commercializes radiopharmaceuticals and other imaging agents that help healthcare professionals detect, diagnose, and treat diseases.
Why Could LNTH Be a Winner?
- Annual revenue growth of 35.6% over the past five years was outstanding, reflecting market share gains this cycle
- Free cash flow margin expanded by 22.9 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
- Rising returns on capital show management is finding more attractive investment opportunities
Lantheus is trading at $53 per share, or 7.9x 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 April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.
The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 5 Strong Momentum 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-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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