1 Unpopular Stock That Deserves Some Love and 2 We Find Risky

September 04, 2025 at 00:39 AM EDT

TGT Cover Image

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.

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:

Target (TGT)

Consensus Price Target: $102.77 (11.2% implied return)

With a higher focus on style and aesthetics compared to other large general merchandise retailers, Target (NYSE: TGT) serves the suburban consumer who is looking for a wide range of products under one roof.

Why Does TGT Give Us Pause?

Lagging same-store sales over the past two years suggest it might have to change its pricing and marketing strategy to stimulate demand
Gross margin of 28.1% is below its competitors, leaving less money for marketing and promotions
Performance over the past six years shows its incremental sales were much less profitable, as its earnings per share fell by 4.2% annually

Target’s stock price of $92.39 implies a valuation ratio of 12.1x forward P/E. Check out our free in-depth research report to learn more about why TGT doesn’t pass our bar.

Northrop Grumman (NOC)

Consensus Price Target: $598.04 (3% implied return)

Responsible for the development of the first stealth bomber, Northrop Grumman (NYSE: NOC) specializes in providing aerospace, defense, and security solutions for various industry applications.

Why Should You Dump NOC?

Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
Expenses have increased as a percentage of revenue over the last five years as its operating margin fell by 5.6 percentage points
Eroding returns on capital suggest its historical profit centers are aging

At $580.67 per share, Northrop Grumman trades at 20.5x forward P/E. If you’re considering NOC for your portfolio, see our FREE research report to learn more.

One Stock to Watch:

United Rentals (URI)

Consensus Price Target: $900.94 (-4.7% implied return)

Owning the largest rental fleet in the world, United Rentals (NYSE: URI) provides equipment rental and related services to construction, industrial, and infrastructure industries.

Why Are We Fans of URI?

Market share has increased this cycle as its 11.8% annual revenue growth over the last five years was exceptional
Disciplined cost controls and effective management resulted in a strong long-term operating margin of 25.8%, and its rise over the last five years was fueled by some leverage on its fixed costs
Share buybacks catapulted its annual earnings per share growth to 18.1%, which outperformed its revenue gains over the last five years

United Rentals is trading at $945.31 per share, or 21.3x forward P/E. 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 9 Market-Beating Stocks. 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 Kadant (+351% 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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