The stocks in this article have caught Wall Street’s attention in a big way, with price targets implying returns above 20%. But investors should take these forecasts with a grain of salt because analysts typically say nice things about companies so their firms can win business in other product lines like M&A advisory.
At StockStory, we look beyond the headlines with our independent analysis to determine whether these bullish calls are justified. That said, here is one stock where Wall Street’s positive outlook is supported by strong fundamentals and two where its enthusiasm might be excessive.
Two Stocks to Sell:
Caesars Entertainment (CZR)
Consensus Price Target: $40.76 (56.8% implied return)
Formerly Eldorado Resorts, Caesars Entertainment (NASDAQ: CZR) is a global gaming and hospitality company operating numerous casinos, hotels, and resort properties.
Why Does CZR Worry Us?
- Flat sales over the last two years suggest it must innovate and find new ways to grow
- Earnings per share fell by 5.4% annually over the last five years while its revenue grew, showing its incremental sales were much less profitable
- 6× net-debt-to-EBITDA ratio shows it’s overleveraged and increases the probability of shareholder dilution if things turn unexpectedly
Caesars Entertainment is trading at $26 per share, or 31.7x forward P/E. To fully understand why you should be careful with CZR, check out our full research report (it’s free).
ICU Medical (ICUI)
Consensus Price Target: $177.83 (45.9% implied return)
Founded in 1984 and named for its initial focus on intensive care units, ICU Medical (NASDAQ: ICUI) develops and manufactures medical products for infusion therapy, vascular access, and vital care applications used in hospitals and other healthcare settings.
Why Is ICUI Risky?
- Muted 1.7% annual revenue growth over the last two years shows its demand lagged behind its healthcare peers
- Projected sales decline of 10.6% for the next 12 months points to a tough demand environment ahead
- Performance over the past five years shows its incremental sales were much less profitable, as its earnings per share fell by 19.1% annually
At $121.88 per share, ICU Medical trades at 16.4x forward P/E. Read our free research report to see why you should think twice about including ICUI in your portfolio.
One Stock to Buy:
Morningstar (MORN)
Consensus Price Target: $333.33 (46.8% implied return)
Founded in 1984 by Joe Mansueto with just $80,000 in personal savings, Morningstar (NASDAQ: MORN) provides independent investment data, research, and analysis tools that help investors, advisors, and institutions make informed financial decisions.
Why Are We Bullish on MORN?
- Offerings and unique value proposition resonate with customers, as seen in its above-market 12.7% annual sales growth over the last five years
- Incremental sales significantly boosted profitability as its annual earnings per share growth of 321% over the last two years outstripped its revenue performance
- Market-beating return on equity illustrates that management has a knack for investing in profitable ventures
Morningstar’s stock price of $227.03 implies a valuation ratio of 24.2x forward P/E. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
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 9 Market-Beating Stocks. 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
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