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3 Unpopular Stocks with Open Questions
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.
At StockStory, we look beyond the headlines with our independent analysis to determine whether these bearish calls are justified. That said, here are three stocks where the outlook is warranted and some alternatives with better fundamentals.
PlayStudios (MYPS)
Consensus Price Target: $0.50 (-2.3% implied return)
Founded by a team of former gaming industry executives, PlayStudios (NASDAQ:MYPS) offers free-to-play digital casino games.
Why Do We Steer Clear of MYPS?
- Products and services aren’t resonating with the market as its revenue declined by 4.1% annually over the last five years
- Poor free cash flow margin of 12.3% for the last two years limits its freedom to invest in growth initiatives, execute share buybacks, or pay dividends
- Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
PlayStudios is trading at $0.51 per share, or 0.3x forward price-to-sales. Read our free research report to see why you should think twice about including MYPS in your portfolio.
Rockwell Automation (ROK)
Consensus Price Target: $478.21 (10.2% implied return)
One of the first companies to address industrial automation, Rockwell Automation (NYSE:ROK) sells products that help customers extract more efficiency from their machinery.
Why Does ROK Give Us Pause?
- Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
- Estimated sales growth of 4.8% for the next 12 months is soft and implies weaker demand
- Eroding returns on capital suggest its historical profit centers are aging
At $434.05 per share, Rockwell Automation trades at 30.8x forward P/E. If you’re considering ROK for your portfolio, see our FREE research report to learn more.
IDEX (IEX)
Consensus Price Target: $254.50 (8.7% implied return)
Founded in 1988, IDEX (NYSE:IEX) is a global manufacturer specializing in highly engineered products such as pumps, flow meters, and fluidics systems for various industries.
Why Are We Hesitant About IEX?
- Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
- Earnings growth over the last two years fell short of the peer group average as its EPS only increased by 3.5% annually
- Eroding returns on capital suggest its historical profit centers are aging
IDEX’s stock price of $234.13 implies a valuation ratio of 26.3x forward P/E. Check out our free in-depth research report to learn more about why IEX doesn’t pass our bar.
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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.