Wall Street is overwhelmingly bullish on the stocks in this article, with price targets suggesting significant upside potential. However, it’s worth remembering that analysts rarely issue sell ratings, partly because their firms often seek other business from the same companies they cover.
At StockStory, we look beyond the headlines with our independent analysis to determine whether these bullish calls are justified. That said, here is one stock likely to meet or exceed Wall Street’s lofty expectations and two where analysts may be overlooking some important risks.
Two Stocks to Sell:
Denny's (DENN)
Consensus Price Target: $5.55 (19.9% implied return)
Open around the clock, Denny’s (NASDAQ: DENN) is a chain of diner restaurants serving breakfast and traditional American fare.
Why Do We Avoid DENN?
- Poor same-store sales performance over the past two years indicates it’s having trouble bringing new diners into its restaurants
- Free cash flow margin shrank by 8.7 percentage points over the last year, suggesting the company is consuming more capital to stay competitive
- Limited cash reserves may force the company to seek unfavorable financing terms that could dilute shareholders
Denny's is trading at $4.63 per share, or 9x forward P/E. Check out our free in-depth research report to learn more about why DENN doesn’t pass our bar.
Brighthouse Financial (BHF)
Consensus Price Target: $56.22 (20.3% implied return)
Spun off from MetLife in 2017 to focus specifically on retail financial products, Brighthouse Financial (NASDAQ: BHF) provides annuity contracts and life insurance products designed to help individuals protect wealth, generate income, and transfer assets.
Why Are We Wary of BHF?
- 1.9% annual declines in net premiums earned for the past five years indicates policy sales struggled this cycle
- Book value per share tumbled by 15.1% annually over the last five years, showing insurance sector trends are working against its favor during this cycle
- Debt-to-equity ratio of 1.3× is concerningly high, indicating excessive leverage that could limit financial flexibility
Brighthouse Financial’s stock price of $46.75 implies a valuation ratio of 0.6x forward P/B. Dive into our free research report to see why there are better opportunities than BHF.
One Stock to Buy:
Merck (MRK)
Consensus Price Target: $100.41 (19.3% implied return)
With roots dating back to 1891 and a portfolio that includes the blockbuster cancer immunotherapy Keytruda, Merck (NYSE: MRK) develops and sells prescription medicines, vaccines, and animal health products across oncology, infectious diseases, cardiovascular, and other therapeutic areas.
Why Do We Love MRK?
- Enormous revenue base of $63.62 billion gives it economies of scale and advantages over new entrants due to the industry’s regulatory complexity
- Adjusted operating profits and efficiency rose over the last two years as it benefited from some fixed cost leverage
- Free cash flow margin expanded by 10.7 percentage points over the last five years, providing additional flexibility for investments and share buybacks/dividends
At $84.13 per share, Merck trades at 9.2x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.
Don’t let fear keep you from great opportunities and take a look at Top 6 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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