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.
Unlike the investment banks, we created StockStory to provide independent analysis that helps you determine which companies are truly worth following. Keeping that in mind, here is one stock where Wall Street’s positive outlook is supported by strong fundamentals and two where analysts may be overlooking some important risks.
Two Stocks to Sell:
Yum China (YUMC)
Consensus Price Target: $57.87 (20.6% implied return)
One of China’s largest restaurant companies, Yum China (NYSE: YUMC) is an independent entity spun off from Yum! Brands in 2016.
Why Does YUMC Give Us Pause?
- Disappointing same-store sales over the past two years show customers aren’t responding well to its menu offerings and dining experience
- Demand will likely be soft over the next 12 months as Wall Street’s estimates imply tepid growth of 5.6%
- Gross margin of 20.1% reflects the bad unit economics inherent in most restaurant businesses
Yum China’s stock price of $47.99 implies a valuation ratio of 16.8x forward P/E. Read our free research report to see why you should think twice about including YUMC in your portfolio.
Oshkosh (OSK)
Consensus Price Target: $152.64 (24.8% implied return)
Oshkosh (NYSE: OSK) manufactures specialty vehicles for the defense, fire, emergency, and commercial industry, operating various brand subsidiaries within each industry.
Why Are We Wary of OSK?
- Sales pipeline suggests its future revenue growth won’t meet our standards as its backlog averaged 1.9% declines over the past two years
- Gross margin of 16.5% reflects its high production costs
- Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 7 percentage points
Oshkosh is trading at $122.27 per share, or 10.6x forward P/E. Dive into our free research report to see why there are better opportunities than OSK.
One Stock to Watch:
PNC Financial Services Group (PNC)
Consensus Price Target: $220.98 (21.6% implied return)
Tracing its roots back to 1852 when Pittsburgh's industrial boom demanded stronger financial institutions, PNC (NYSE: PNC) is a diversified financial institution that provides retail banking, corporate banking, and asset management services through a coast-to-coast branch network.
Why Are We Fans of PNC?
- Share repurchases over the last five years enabled its annual earnings per share growth of 21% to outpace its revenue gains
- Impressive 17.2% annual tangible book value per share growth over the last two years indicates it’s building equity value this cycle
- Market-beating return on equity illustrates that management has a knack for investing in profitable ventures
At $181.74 per share, PNC Financial Services Group trades at 1.3x forward P/B. 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
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check 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 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% 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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