Wall Street has set ambitious price targets for the stocks in this article. While this suggests attractive upside potential, it’s important to remain skeptical because analysts face institutional pressures that can sometimes lead to overly optimistic forecasts.
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 are three stocks where Wall Street’s enthusiasm may be misplaced and some other investments worth exploring instead.
The Real Brokerage (REAX)
Consensus Price Target: $6.33 (53.3% implied return)
Founded in Toronto, Canada in 2014, The Real Brokerage (NASDAQ: REAX) is a technology-driven real estate brokerage firm combining a tech-centric model with an agent-centric philosophy.
Why Do We Steer Clear of REAX?
- Historical operating margin losses point to an inefficient cost structure
- Earnings per share were flat over the last five years while its revenue grew, showing its incremental sales were less profitable
- Projected 1.9 percentage point decline in its free cash flow margin next year reflects the company’s plans to increase its investments to defend its market position
At $4.13 per share, The Real Brokerage trades at 16.1x forward EV-to-EBITDA. Read our free research report to see why you should think twice about including REAX in your portfolio.
LifeStance Health Group (LFST)
Consensus Price Target: $8.43 (46.8% implied return)
With over 6,600 licensed mental health professionals treating more than 880,000 patients annually, LifeStance Health (NASDAQ: LFST) provides outpatient mental health services through a network of clinicians offering psychiatric evaluations, psychological testing, and therapy across 33 states.
Why Does LFST Fall Short?
- Subscale operations are evident in its revenue base of $1.32 billion, meaning it has fewer distribution channels than its larger rivals
- Low free cash flow margin of -0.8% for the last five years gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders
- Push for growth has led to negative returns on capital, signaling value destruction
LifeStance Health Group is trading at $5.74 per share, or 31.3x forward P/E. If you’re considering LFST for your portfolio, see our FREE research report to learn more.
Bread Financial (BFH)
Consensus Price Target: $68 (23.6% implied return)
Formerly known as Alliance Data Systems until its 2022 rebranding, Bread Financial (NYSE: BFH) provides credit cards, installment loans, and savings products to consumers while powering branded payment solutions for retailers and merchants.
Why Do We Avoid BFH?
- Sales tumbled by 5.4% annually over the last two years, showing market trends are working against its favor during this cycle
- Incremental sales over the last five years were less profitable as its earnings per share were flat while its revenue grew
Bread Financial’s stock price of $55.02 implies a valuation ratio of 7.1x forward P/E. Dive into our free research report to see why there are better opportunities than BFH.
High-Quality Stocks for All Market Conditions
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking out our Top 6 Stocks for this week. 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-micro-cap company Kadant (+351% 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
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.
