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1 of Wall Street’s Favorite Stocks with Exciting Potential and 2 We Ignore
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.
Unlike the investment banks, we created StockStory to provide independent analysis that helps you determine which companies are truly worth following. Keeping that in mind, here is one stock where Wall Street’s excitement appears well-founded and two where consensus estimates seem disconnected from reality.
Two Stocks to Sell:
Chewy (CHWY)
Consensus Price Target: $30.77 (24.8% implied return)
Founded by Ryan Cohen, who later became known for his involvement in GameStop, Chewy (NYSE:CHWY) is an online retailer specializing in pet food, supplies, and healthcare services.
Why Are We Wary of CHWY?
- Annual sales growth of 7.1% over the last three years lagged behind its consumer internet peers as its large revenue base made it difficult to generate incremental demand
- Demand will likely be soft over the next 12 months as Wall Street’s estimates imply tepid growth of 6.8%
- Bad unit economics and steep infrastructure costs are reflected in its low gross margin of 29.6%
Chewy is trading at $24.65 per share, or 10.7x forward EV/EBITDA. Check out our free in-depth research report to learn more about why CHWY doesn’t pass our bar.
C.H. Robinson Worldwide (CHRW)
Consensus Price Target: $199.84 (39.3% implied return)
Engaging in contracts with tens of thousands of transportation companies, C.H. Robinson (NASDAQ:CHRW) offers freight transportation and logistics services.
Why Is CHRW Not Exciting?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 2.3% annually over the last five years
- Gross margin of 7.5% is below its competitors, leaving less money to invest in areas like marketing and R&D
- Diminishing returns on capital suggest its earlier profit pools are drying up
C.H. Robinson Worldwide’s stock price of $143.49 implies a valuation ratio of 20.5x forward P/E. If you’re considering CHRW for your portfolio, see our FREE research report to learn more.
One Stock to Watch:
MACOM (MTSI)
Consensus Price Target: $395.33 (53.6% implied return)
Founded in the 1950s as Microwave Associates, a communications supplier to the US Army Signal Corp, today MACOM Technology Solutions (NASDAQ: MTSI) is a provider of analog chips used in optical, wireless, and satellite networks.
Why Are We Positive on MTSI?
- Impressive 30.9% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Estimated revenue growth of 49.7% for the next 12 months implies demand will accelerate from its two-year trend
- Earnings per share grew by 18.1% annually over the last five years and easily exceeded the peer group average
At $257.35 per share, MACOM trades at 32.3x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI is taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies.
Our AI system flagged Palantir before it ran 1,662% between October 2022 and February 2026. AppLovin before it ran 753% between February 2024 and February 2026. Nvidia before it ran 1,178% between January 2023 and February 2026. Each week it produces 6 new names that pass the same tests. Get Our Top 6 Stocks for Free HERE.
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-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.