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.
Accurately determining a company’s long-term prospects isn’t easy, especially when sentiment is weak. That’s where StockStory comes in – to help you find attractive investment candidates backed by unbiased research. Keeping that in mind, here are two stocks poised to prove Wall Street wrong and one where the outlook is warranted.
Consensus Price Target: $36.44 (3% implied return)
Operating through a largely Asian facility footprint, Amkor Technologies (NASDAQ:AMKR) provides outsourced packaging and testing for semiconductors.
Why Does AMKR Worry Us?
-
Sales tumbled by 1.6% annually over the last two years, showing market trends are working against its favor during this cycle
-
Gross margin of 14.2% is below its competitors, leaving less money to invest in areas like marketing and R&D
-
Low free cash flow margin of 5.1% for the last two years gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders
Amkor is trading at $35.39 per share, or 22.7x forward P/E. Read our free research report to see why you should think twice about including AMKR in your portfolio, it’s free for active Edge members.
Consensus Price Target: $510.93 (-4.1% implied return)
Known for detecting the massive SolarWinds hack in 2020 that compromised numerous government agencies, CrowdStrike (NASDAQ:CRWD) provides cloud-based cybersecurity solutions that protect endpoints, cloud workloads, identity, and data through its Falcon platform.
Why Will CRWD Beat the Market?
-
Average billings growth of 25% over the last year enhances its liquidity and shows there is steady demand for its products
-
Forecasted revenue growth of 21.6% for the next 12 months indicates its momentum over the last two years is sustainable
-
Fast payback periods on sales and marketing expenses allow the company to invest heavily and onboard many customers concurrently
At $533 per share, CrowdStrike trades at 25.2x forward price-to-sales. Is now a good time to buy? Find out in our full research report, it’s free for active Edge members.
Consensus Price Target: $75.50 (8.3% implied return)
Manufacturing the largest pump ever built for nuclear power generation, Flowserve (NYSE:FLS) manufactures and sells flow control equipment for various industries.