3 of Wall Street’s Favorite Stocks Walking a Fine Line

September 12, 2025 at 00:33 AM EDT

CXM Cover Image

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.

Luckily for you, we at StockStory have no conflicts of interest - our sole job is to help you find genuinely promising companies. That said, here are three stocks where Wall Street’s estimates seem disconnected from reality and some better opportunities to consider.

Sprinklr (CXM)

Consensus Price Target: $10.44 (32.2% implied return)

With a proprietary AI engine processing 450 million data points daily across 30+ digital channels, Sprinklr (NYSE: CXM) provides cloud-based software that helps large enterprises manage customer experiences across social, messaging, chat, and voice channels.

Why Are We Wary of CXM?

Customers had second thoughts about committing to its platform over the last year as its average billings growth of 3.1% underwhelmed
Estimated sales growth of 4.1% for the next 12 months implies demand will slow from its three-year trend
High servicing costs result in a relatively inferior gross margin of 69.9% that must be offset through increased usage

At $7.90 per share, Sprinklr trades at 2.4x forward price-to-sales. Dive into our free research report to see why there are better opportunities than CXM.

Methode Electronics (MEI)

Consensus Price Target: $10.25 (24.7% implied return)

Founded in 1946, Methode Electronics (NYSE: MEI) is a global supplier of custom-engineered solutions for Original Equipment Manufacturers (OEMs).

Why Do We Pass on MEI?

Customers postponed purchases of its products and services this cycle as its revenue declined by 6.8% annually over the last two years
Free cash flow margin shrank by 11.6 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive
Waning returns on capital from an already weak starting point displays the inefficacy of management’s past and current investment decisions

Methode Electronics is trading at $8.22 per share, or 205.5x forward P/E. Read our free research report to see why you should think twice about including MEI in your portfolio.

Telephone and Data Systems (TDS)

Consensus Price Target: $52 (32% implied return)

Operating primarily through its majority-owned subsidiary UScellular and wholly-owned TDS Telecom, Telephone and Data Systems (NYSE: TDS) provides wireless, broadband, video, and voice communications services to 4.6 million wireless and 1.2 million broadband customers across the United States.

Why Should You Sell TDS?

Sales tumbled by 1.5% annually over the last five years, showing market trends are working against its favor during this cycle
Falling earnings per share over the last five years has some investors worried as stock prices ultimately follow EPS over the long term

Telephone and Data Systems’s stock price of $39.38 implies a valuation ratio of 3.9x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than TDS.

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 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).

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3 of Wall Street’s Favorite Stocks Walking a Fine Line

Sprinklr (CXM)

Methode Electronics (MEI)

Telephone and Data Systems (TDS)

High-Quality Stocks for All Market Conditions

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