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.

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. That said, here is one stock where you should be greedy instead of fearful and two where the outlook is warranted.

Two Stocks to Sell:

Valley National Bank (VLY)

Consensus Price Target: $11.42 (6.7% implied return)

Tracing its roots back to 1927 during the economic boom before the Great Depression, Valley National Bancorp (NASDAQGS:VLY) operates Valley National Bank, providing commercial, consumer, and wealth management banking services across several states.

Why Are We Wary of VLY?

1. Annual sales declines of 2.1% for the past two years show its products and services struggled to connect with the market during this cycle
2. Inferior net interest margin of 2.9% means it must compensate for lower profitability through increased loan originations
3. Performance over the past two years shows each sale was less profitable as its earnings per share dropped by 25% annually, worse than its revenue

At $10.70 per share, Valley National Bank trades at 0.8x forward P/B. If you’re considering VLY for your portfolio, see our FREE research report to learn more.

Capital Southwest (CSWC)

Consensus Price Target: $24 (7% implied return)

Originally founded in 1961 as a venture capital investor that helped launch Texas Instruments, Capital Southwest (NASDAQ: CSWC) is a business development company that provides debt and equity financing to middle-market companies primarily in the United States.

Why Are We Hesitant About CSWC?

1. Earnings per share were flat over the last two years while its revenue grew, showing its incremental sales were less profitable

Capital Southwest’s stock price of $22.43 implies a valuation ratio of 9.6x forward P/E. Check out our free in-depth research report to learn more about why CSWC doesn’t pass our bar.

One Stock to Buy:

Axos Financial (AX)

Consensus Price Target: $100.17 (10.9% implied return)

Originally founded as Bank of Internet USA in 1999 before rebranding in 2018, Axos Financial (NYSE: AX) is a diversified financial services company that provides digital banking, securities clearing, and investment advisory solutions to retail and business customers nationwide.

Why Are We Backing AX?

1. Annual net interest income growth of 15.9% over the last five years was superb and indicates its market share increased during this cycle
2. Differentiated product suite is reflected in its Strong performance of its loan book results in a High-yielding loan book and low cost of funds are reflected in its best-in-class net interest margin of 4.8%
3. Earnings growth has massively outpaced its peers over the last two years as its EPS has compounded at 18% annually

Axos Financial is trading at $90.29 per share, or 1.6x forward P/B. Is now the time to initiate a position? Find out in our full research report, it’s free.

High-Quality Stocks for All Market Conditions

Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.

Take advantage of the rebound by checking 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).

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