Wall Street’s bearish price targets for the stocks in this article signal serious concerns. Such forecasts are uncommon in an industry where maintaining cordial corporate relationships often trumps delivering the hard truth.
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:
Designer Brands (DBI)
Consensus Price Target: $7.25 (8.3% implied return)
Founded in 1969 as a shoe importer and distributor, Designer Brands (NYSE: DBI) is an American discount retailer focused on footwear and accessories.
Why Do We Pass on DBI?
- Poor same-store sales performance over the past two years indicates it’s having trouble bringing new shoppers into its brick-and-mortar locations
- Earnings per share have contracted by 78.2% annually over the last three years, a headwind for returns as stock prices often echo long-term EPS performance
- 11× net-debt-to-EBITDA ratio makes lenders less willing to extend additional capital, potentially necessitating dilutive equity offerings
Designer Brands is trading at $6.69 per share, or 21.5x forward P/E. To fully understand why you should be careful with DBI, check out our full research report (it’s free).
Pediatrix Medical Group (MD)
Consensus Price Target: $21.33 (10.6% implied return)
With a network of approximately 2,620 affiliated physicians caring for some of the most vulnerable patients, Pediatrix Medical Group (NYSE: MD) provides specialized physician services focused on neonatal, maternal-fetal, pediatric cardiology and other pediatric subspecialty care across 37 states.
Why Is MD Not Exciting?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 2% annually over the last two years
- Estimated sales for the next 12 months are flat and imply a softer demand environment
- Eroding returns on capital from an already low base indicate that management’s recent investments are destroying value
At $19.29 per share, Pediatrix Medical Group trades at 8.9x forward P/E. Read our free research report to see why you should think twice about including MD in your portfolio.
One Stock to Watch:
Colgate-Palmolive (CL)
Consensus Price Target: $97.21 (5.1% implied return)
Formed after the 1928 combination between toothpaste maker Colgate and soap maker Palmolive-Peet, Colgate-Palmolive (NYSE: CL) is a consumer products company that focuses on personal, household, and pet products.
Why Does CL Catch Our Eye?
- Customer loyalty and massive revenue base of $20.38 billion makes it a household name that influences purchasing decisions
- Products command premium prices and lead to a best-in-class gross margin of 60.3%
- Strong free cash flow margin of 17.7% enables it to reinvest or return capital consistently
Colgate-Palmolive’s stock price of $92.54 implies a valuation ratio of 24.6x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI 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%. AppLovin before it ran 753%. Nvidia before it ran 1,178%. 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 (+1,326% between June 2020 and June 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.
