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 likely to meet or exceed Wall Street’s lofty expectations and one where consensus estimates seem disconnected from reality.
One Stock to Sell:
Acadia Healthcare (ACHC)
Consensus Price Target: $42.86 (93.5% implied return)
With a network of over 250 facilities serving patients in 38 states and Puerto Rico, Acadia Healthcare (NASDAQ: ACHC) operates facilities providing mental health and substance use disorder treatment services across the United States.
Why Is ACHC Not Exciting?
- Annual revenue growth of 2% over the last five years was below our standards for the healthcare sector
- Weak admissions over the past two years suggest it might have to lower prices to accelerate growth
- Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 30 percentage points
At $22.15 per share, Acadia Healthcare trades at 8.1x forward P/E. Dive into our free research report to see why there are better opportunities than ACHC.
Two Stocks to Watch:
AppLovin (APP)
Consensus Price Target: $459.41 (22% implied return)
Co-founded by Adam Foroughi, who was frustrated with not being able to find a good solution to market his own dating app, AppLovin (NASDAQ: APP) is both a mobile game studio and provider of marketing and monetization tools for mobile app developers.
Why Should APP Be on Your Watchlist?
- Software platform has product-market fit given the rapid recovery of its customer acquisition costs
- Highly efficient business model is illustrated by its impressive 42.8% operating margin, and it turbocharged its profits by achieving some fixed cost leverage
- Strong free cash flow margin of 49.3% enables it to reinvest or return capital consistently
AppLovin is trading at $376.50 per share, or 23x forward price-to-sales. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
FirstSun Capital Bancorp (FSUN)
Consensus Price Target: $43.75 (26.4% implied return)
Tracing its roots back to 1892 when it first opened its doors in Kansas, FirstSun Capital Bancorp (NASDAQ: FSUN) operates Sunflower Bank, providing commercial and consumer banking services to businesses and individuals across the Southwest region.
Why Is FSUN a Top Pick?
- Impressive 20.5% annual net interest income growth over the last four years indicates it’s winning market share this cycle
- Differentiated product suite leads to a Strong performance of its loan book results in a High-yielding loan book and low cost of funds are reflected in its top-tier net interest margin of 4.2%
- Balance sheet strength has increased this cycle as its 12.1% annual tangible book value per share growth over the last five years was exceptional
FirstSun Capital Bancorp’s stock price of $34.60 implies a valuation ratio of 0.8x forward P/B. Is now a good time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
The market surged in 2024 and reached record highs after Donald Trump’s presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025.
While the crowd speculates what might happen next, we’re homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver’s seat and build a durable portfolio by checking out our Top 9 Market-Beating Stocks. 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.
