Wall Street has issued downbeat forecasts for the stocks in this article. These predictions are rare - financial institutions typically hesitate to say bad things about a company because it can jeopardize their other revenue-generating business lines like M&A advisory.

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 facing legitimate challenges and some alternatives worth exploring instead.

Etsy (ETSY)

Consensus Price Target: $52.46 (-3.7% implied return)

Founded by a struggling amateur furniture maker Robert Kalin and his two friends, Etsy (NASDAQ: ETSY) is one of the world’s largest online marketplaces, focusing on handmade or vintage items.

Why Does ETSY Give Us Pause?

1. Market opportunities are plateauing as its active buyers were flat over the last two years
2. Forecasted revenue decline of 1.9% for the upcoming 12 months implies demand will fall off a cliff
3. Earnings growth underperformed the sector average over the last three years as its EPS grew by just 2.6% annually

At $54.50 per share, Etsy trades at 7.6x forward EV/EBITDA. Read our free research report to see why you should think twice about including ETSY in your portfolio.

Church & Dwight (CHD)

Consensus Price Target: $100.39 (3.6% implied return)

Best known for its Arm & Hammer baking soda, Church & Dwight (NYSE: CHD) is a household and personal care products company with a vast portfolio that spans laundry detergent to toothbrushes to hair removal creams.

Why Are We Hesitant About CHD?

1. Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
2. Estimated sales growth of 1% for the next 12 months implies demand will slow from its three-year trend
3. Efficiency has decreased over the last year as its operating margin fell by 4.9 percentage points

Church & Dwight’s stock price of $96.94 implies a valuation ratio of 25.8x forward P/E. Dive into our free research report to see why there are better opportunities than CHD.

Kimball Electronics (KE)

Consensus Price Target: $19.75 (2.7% implied return)

Founded in 1961, Kimball Electronics (NYSE: KE) is a global contract manufacturer specializing in electronics and manufacturing solutions for automotive, medical, and industrial markets.

Why Do We Avoid KE?

1. Annual sales declines of 5% for the past two years show its products and services struggled to connect with the market during this cycle
2. Earnings per share have contracted by 13.7% annually over the last four years, a headwind for returns as stock prices often echo long-term EPS performance
3. Low free cash flow margin of -0.3% for the last five years gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders

Kimball Electronics is trading at $19.24 per share, or 17.9x forward P/E. To fully understand why you should be careful with KE, check out our full research report (it’s free).

High-Quality Stocks for All Market Conditions

Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.

While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like 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-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