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 poised to prove Wall Street wrong and two where the outlook is warranted.
Two Stocks to Sell:
Otis (OTIS)
Consensus Price Target: $100.57 (3.2% implied return)
Credited with inventing the first hydraulic passenger elevator, Otis Worldwide (NYSE: OTIS) is an elevator and escalator manufacturing, installation and service company.
Why Does OTIS Give Us Pause?
- Organic revenue growth fell short of our benchmarks over the past two years and implies it may need to improve its products, pricing, or go-to-market strategy
- Demand will likely be soft over the next 12 months as Wall Street’s estimates imply tepid growth of 3.9%
- Free cash flow margin shrank by 2.8 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive
Otis is trading at $97.41 per share, or 23.3x forward P/E. Read our free research report to see why you should think twice about including OTIS in your portfolio.
U.S. Cellular (USM)
Consensus Price Target: $74.06 (27% implied return)
Operating as a majority-owned subsidiary of Telephone and Data Systems since its founding in 1983, US Cellular (NYSE: USM) is a regional wireless telecommunications provider serving 4.6 million customers across 21 states with mobile phone, internet, and IoT services.
Why Should You Dump USM?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 1.6% annually over the last five years
- Overall productivity fell over the last five years as its plummeting sales were accompanied by a decline in its adjusted operating margin
- Falling earnings per share over the last five years has some investors worried as stock prices ultimately follow EPS over the long term
U.S. Cellular’s stock price of $58.33 implies a valuation ratio of 5.2x forward EV-to-EBITDA. If you’re considering USM for your portfolio, see our FREE research report to learn more.
One Stock to Watch:
Cigna (CI)
Consensus Price Target: $369.67 (11% implied return)
With roots dating back to 1792 and serving millions of customers across the globe, The Cigna Group (NYSE: CI) provides healthcare services through its Evernorth Health Services and Cigna Healthcare segments, offering pharmacy benefits, specialty care, and medical plans.
Why Are We Fans of CI?
- Impressive 18.1% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Unparalleled scale of $255.3 billion in revenue enables it to spread administrative costs across a larger membership base
- Earnings growth has comfortably beaten the peer group average over the last five years as its EPS has compounded at 9.1% annually
At $333.01 per share, Cigna trades at 10.9x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
Stocks That Overcame Trump’s 2018 Tariffs
Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.
While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years.
Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like United Rentals (+322% five-year return). Find your next big winner with StockStory today for free.
