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 are two stocks where Wall Street’s pessimism is creating a buying opportunity and one facing legitimate challenges.
One Stock to Sell:
Tilray (TLRY)
Consensus Price Target: $0.93 (-11.7% implied return)
Founded in 2013, Tilray Brands (NASDAQ: TLRY) engages in cannabis research, cultivation, and distribution, offering a range of medical and recreational cannabis products, hemp-based foods, and alcoholic beverages.
Why Do We Avoid TLRY?
- Day-to-day expenses have swelled relative to revenue over the last year as its operating margin fell by 255.8 percentage points
- Incremental sales over the last three years were much less profitable as its earnings per share fell by 32.4% annually while its revenue grew
- Free cash flow margin shrank by 8.1 percentage points over the last year, suggesting the company is consuming more capital to stay competitive
Tilray’s stock price of $1.05 implies a valuation ratio of 14.7x forward EV-to-EBITDA. Check out our free in-depth research report to learn more about why TLRY doesn’t pass our bar.
Two Stocks to Watch:
Lyft (LYFT)
Consensus Price Target: $17.09 (10.1% implied return)
Founded by Logan Green and John Zimmer as a long-distance intercity carpooling company Zimride, Lyft (NASDAQ: LYFT) operates a ridesharing network in the US and Canada.
Why Do We Like LYFT?
- Active Riders are rising, meaning the company can increase revenue without incurring additional customer acquisition costs if it can cross-sell additional products and features
- Additional sales over the last three years increased its profitability as the 39.2% annual growth in its earnings per share outpaced its revenue
- Free cash flow margin jumped by 23.7 percentage points over the last few years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
Lyft is trading at $15.52 per share, or 11.6x forward EV/EBITDA. Is now a good time to buy? See for yourself in our full research report, it’s free.
Powell (POWL)
Consensus Price Target: $245.93 (-3.3% implied return)
Originally a metal-working shop supporting local petrochemical facilities, Powell (NYSE: POWL) has grown from a small Houston manufacturer to a global provider of electrical systems.
Why Will POWL Outperform?
- Market share has increased this cycle as its 28.7% annual revenue growth over the last two years was exceptional
- Performance over the past two years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 124% outpaced its revenue gains
- Free cash flow margin grew by 12.8 percentage points over the last five years, giving the company more chips to play with
At $254.20 per share, Powell trades at 17.4x forward P/E. 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
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 Growth Stocks for this month. 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
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