When Wall Street turns bearish on a stock, it’s worth paying attention. These calls stand out because analysts rarely issue grim ratings on companies for fear their firms will lose out in other business lines such as M&A advisory.
Accurately determining a company’s long-term prospects isn’t easy, especially when sentiment is weak. That’s where StockStory comes in - to help you find attractive investment candidates backed by unbiased research. Keeping that in mind, here is one stock where you should be greedy instead of fearful and two where the outlook is warranted.
Two Stocks to Sell:
AMETEK (AME)
Consensus Price Target: $205.71 (8.5% implied return)
Started from its humble beginnings in motor repair, AMETEK (NYSE: AME) manufactures electronic devices used in industries like aerospace, power, and healthcare.
Why Does AME Worry Us?
- 4.3% annual revenue growth over the last two years was slower than its industrials peers
- Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
AMETEK is trading at $189.56 per share, or 26x forward P/E. To fully understand why you should be careful with AME, check out our full research report (it’s free).
RTX (RTX)
Consensus Price Target: $164.58 (3.5% implied return)
Originally focused on refrigeration technology, Raytheon (NSYE:RTX) provides a a variety of products and services to the aerospace and defense industries.
Why Are We Hesitant About RTX?
- Estimated sales growth of 4.8% for the next 12 months implies demand will slow from its two-year trend
- Earnings growth underperformed the sector average over the last five years as its EPS grew by just 4.8% annually
- ROIC of 3.7% reflects management’s challenges in identifying attractive investment opportunities
RTX’s stock price of $159 implies a valuation ratio of 25.6x forward P/E. Read our free research report to see why you should think twice about including RTX in your portfolio.
One Stock to Buy:
NMI Holdings (NMIH)
Consensus Price Target: $44.14 (13.2% implied return)
Founded in the aftermath of the 2008 housing crisis to bring new capacity to the mortgage insurance market, NMI Holdings (NASDAQ: NMIH) provides mortgage insurance that protects lenders against losses when homebuyers default on their mortgage loans.
Why Do We Love NMIH?
- Steady 9.8% annualized growth in net premiums earned over the last two years shows its insurance offerings are gaining traction
- Underwriting operating profits and efficiency rose over the last four years as it benefited from some fixed cost leverage
- Balance sheet strength has increased this cycle as its 16% annual book value per share growth over the last five years was exceptional
At $38.98 per share, NMI Holdings trades at 1.2x forward P/B. Is now the right time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
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-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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