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.
Luckily for you, we at StockStory have no conflicts of interest - our sole job is to help you find genuinely promising companies. That said, here is one stock likely to meet or exceed Wall Street’s lofty expectations and two where consensus estimates seem disconnected from reality.
Two stocks to sell:
Sportsman's Warehouse (SPWH)
Consensus price target: $2.84 (154% implied return)
A go-to destination for individuals passionate about hunting, fishing, camping, hiking, shooting sports, and more, Sportsman's Warehouse (NASDAQ: SPWH) is an American specialty retailer offering a diverse range of active gear, equipment, and apparel.
Why Do We Avoid SPWH?
- Lagging same-store sales over the past two years suggest it might have to change its pricing and marketing strategy to stimulate demand
- Issuance of new shares over the last three years caused its earnings per share to fall by 59.3% annually, even worse than its revenue declines
Sportsman's Warehouse’s stock price of $1.12 implies a valuation ratio of 16.3x forward EV-to-EBITDA. Dive into our free research report to see why there are better opportunities than SPWH.
Richardson Electronics (RELL)
Consensus price target: $25.50 (49% implied return)
Founded in 1947, Richardson Electronics (NASDAQ: RELL) is a distributor of power grid and microwave tubes as well as consumables related to those products.
Why Do We Think Twice About RELL?
- 4.5% annual revenue growth over the last five years was slower than its industrials peers
- Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 0% for the last five years
- Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
At $17.12 per share, Richardson Electronics trades at 26.3x forward P/E. Read our free research report to see why you should think twice about including RELL in your portfolio.
One stock to watch:
EnerSys (ENS)
Consensus price target: $249.48 (77.1% implied return)
Supplying batteries that power equipment as big as mining rigs, EnerSys (NYSE: ENS) manufactures various kinds of batteries for a range of industries.
Why Does ENS Stand Out?
- Operating profits increased over the last five years as the company gained some leverage on its fixed costs and became more efficient
- Share repurchases over the last two years enabled its annual earnings per share growth of 20% to outpace its revenue gains
- Free cash flow margin increased by 23.8 percentage points over the last five years, giving the company more capital to invest or return to shareholders
EnerSys is trading at $140.89 per share, or 11.9x forward P/E. Is now the right time to buy? See for yourself in our full research report, it’s free.
Stocks we like even more
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
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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 Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.
