Wall Street’s bearish price targets for the stocks in this article signal serious concerns. Such forecasts are uncommon in an industry where maintaining cordial corporate relationships often trumps delivering the hard truth.
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. Keeping that in mind, here are three stocks where the skepticism is well-placed and some better opportunities to consider.
Procore (PCOR)
Consensus Price Target: $79.23 (6.9% implied return)
Used to manage the multi-year expansion of the Panama Canal that began in 2007, Procore (NYSE: PCOR) offers a software-as-service project, finance, and quality management platform for the construction industry.
Why Are We Cautious About PCOR?
- Track record of operating margin losses stem from its decision to pursue growth instead of profits
- Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 9.8% for the last year
Procore’s stock price of $74.13 implies a valuation ratio of 8.4x forward price-to-sales. Read our free research report to see why you should think twice about including PCOR in your portfolio.
Floor And Decor (FND)
Consensus Price Target: $83.84 (6.6% implied return)
Operating large, warehouse-style stores, Floor & Decor (NYSE: FND) is a specialty retailer that specializes in hard flooring surfaces for the home such as tiles, hardwood, stone, and laminates.
Why Are We Wary of FND?
- Disappointing same-store sales over the past two years show customers aren’t responding well to its product selection and store experience
- Smaller revenue base of $4.52 billion means it hasn’t achieved the economies of scale that some industry juggernauts enjoy
- Below-average returns on capital indicate management struggled to find compelling investment opportunities, and its decreasing returns suggest its historical profit centers are aging
Floor And Decor is trading at $78.63 per share, or 37.5x forward P/E. Check out our free in-depth research report to learn more about why FND doesn’t pass our bar.
Avis Budget Group (CAR)
Consensus Price Target: $125 (-35.1% implied return)
The parent company of brands such as Zipcar and Budget Truck Rental, Avis (NASDAQ: CAR) is a provider of car rental and mobility solutions.
Why Do We Pass on CAR?
- Performance surrounding its available rental days - car rental has lagged its peers
- Waning returns on capital imply its previous profit engines are losing steam
- Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution
At $192.58 per share, Avis Budget Group trades at 6x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than CAR.
High-Quality Stocks for All Market Conditions
Donald Trump’s April 2024 "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 Kadant (+351% 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
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.
