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 are three stocks where Wall Street’s estimates seem disconnected from reality and some better opportunities to consider.
Adtalem (ATGE)
Consensus Price Target: $161 (66.5% implied return)
Formerly known as DeVry Education Group, Adtalem Global Education (NYSE: ATGE) is a global provider of workforce solutions and educational services.
Why Do We Avoid ATGE?
- Muted 13.9% annual revenue growth over the last five years shows its demand lagged behind its consumer discretionary peers
- Capital intensity will likely increase as its free cash flow margin is anticipated to drop by 2.8 percentage points over the next year
- Underwhelming 10.6% return on capital reflects management’s difficulties in finding profitable growth opportunities
Adtalem is trading at $96.68 per share, or 11.8x forward P/E. To fully understand why you should be careful with ATGE, check out our full research report (it’s free).
Pinnacle Financial Partners (PNFP)
Consensus Price Target: $116.17 (17.3% implied return)
Founded in 2000 with a focus on delivering big-bank capabilities with community bank personalization, Pinnacle Financial Partners (NASDAQ: PNFP) is a Tennessee-based financial holding company that provides banking, investment, trust, mortgage, and insurance services to businesses and individuals.
Why Does PNFP Worry Us?
- Weak unit economics are reflected in its net interest margin of 3.2%, one of the worst among bank companies
- Day-to-day expenses have swelled relative to revenue over the last four years as its efficiency ratio increased by 7 percentage points
- Estimated tangible book value per share growth of 2.8% for the next 12 months implies profitability will slow from its two-year trend
Pinnacle Financial Partners’s stock price of $99 implies a valuation ratio of 1x forward P/B. Dive into our free research report to see why there are better opportunities than PNFP.
Dolby Laboratories (DLB)
Consensus Price Target: $81 (26% implied return)
Known for its iconic "D" logo that appears before countless movies and TV shows, Dolby Laboratories (NYSE: DLB) designs and licenses audio and video technologies that enhance entertainment experiences in movies, TV shows, music, and other media.
Why Is DLB Risky?
- 1.2% annual revenue growth over the last five years was slower than its software peers
- Competitive market means the company must spend more on sales and marketing to stand out even if the return on investment is low
- Costs have risen faster than its revenue over the last year, causing its operating margin to decline by 2.2 percentage points
At $64.31 per share, Dolby Laboratories trades at 4.4x forward price-to-sales. Read our free research report to see why you should think twice about including DLB in your portfolio.
Stocks We Like More
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
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 Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.
