When Wall Street turns bearish on a stock, it’s worth paying attention. These calls stand out because analysts rarely issue grim ratings on companies for fear their firms will lose out in other business lines such as M&A advisory.
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. Keeping that in mind, here is one stock poised to prove Wall Street wrong and two where the outlook is warranted.
Two Stocks to Sell:
J. M. Smucker (SJM)
Consensus Price Target: $121.59 (4.6% implied return)
Best known for its fruit jams and spreads, J.M Smucker (NYSE: SJM) is a packaged foods company whose products span from peanut butter and coffee to pet food.
Why Do We Pass on SJM?
- Declining unit sales over the past two years show it’s struggled to move its products and had to rely on price increases
- Forecasted revenue decline of 3.2% for the upcoming 12 months implies demand will fall off a cliff
- Underwhelming 1.1% return on capital reflects management’s difficulties in finding profitable growth opportunities, and its falling returns suggest its earlier profit pools are drying up
J. M. Smucker is trading at $116.28 per share, or 11.6x forward P/E. To fully understand why you should be careful with SJM, check out our full research report (it’s free).
TowneBank (TOWN)
Consensus Price Target: $39.25 (7.7% implied return)
Founded in 1998 with a commitment to community-centered banking in the Hampton Roads region, TowneBank (NASDAQ: TOWN) is a community-focused financial institution providing banking, lending, and wealth management services to individuals and businesses in Virginia and North Carolina.
Why Does TOWN Worry Us?
- Muted 5.2% annual revenue growth over the last five years shows its demand lagged behind its banking peers
- Operational productivity has decreased over the last five years as its efficiency ratio worsened by 8.5 percentage points
- Capital trends were unexciting over the last two years as its 4% annual tangible book value per share growth was below the typical banking firm
At $36.45 per share, TowneBank trades at 1.1x forward P/B. If you’re considering TOWN for your portfolio, see our FREE research report to learn more.
One Stock to Watch:
RenaissanceRe (RNR)
Consensus Price Target: $325.47 (-0.3% implied return)
Born in Bermuda after the devastating Hurricane Andrew created a crisis in the catastrophe insurance market, RenaissanceRe (NYSE: RNR) provides property, casualty, and specialty reinsurance and insurance solutions to customers worldwide, primarily through intermediaries.
Why Do We Like RNR?
- Strong 17.4% annualized net premiums earned expansion over the last five years shows it’s capturing market share this cycle
- Pre-tax profits increased over the last five years as the company gained some leverage on its fixed costs and became more efficient
- Share buybacks catapulted its annual earnings per share growth to 270%, which outperformed its revenue gains over the last five years
RenaissanceRe’s stock price of $326.29 implies a valuation ratio of 1.2x forward P/B. Is now a good time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
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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.
