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. Keeping that in mind, here are two stocks where you should be greedy instead of fearful and one facing legitimate challenges.
One Stock to Sell:
Sleep Number (SNBR)
Consensus Price Target: $6.50 (-38.7% implied return)
Known for mattresses that can be adjusted with regards to firmness, Sleep Number (NASDAQ:SNBR) manufactures and sells its own brand of bedding products such as mattresses, bed frames, and pillows.
Why Do We Think SNBR Will Underperform?
- Disappointing same-store sales over the past two years show customers aren’t responding well to its product selection and store experience
- Sales are projected to tank by 4.6% over the next 12 months as demand evaporates further
- Unfavorable liquidity position could lead to additional equity financing that dilutes shareholders
Sleep Number is trading at $10.60 per share, or 2.3x forward EV-to-EBITDA. Read our free research report to see why you should think twice about including SNBR in your portfolio.
Two Stocks to Watch:
Paycom (PAYC)
Consensus Price Target: $240.33 (-6.5% implied return)
Founded in 1998 as one of the first online payroll companies, Paycom (NYSE:PAYC) provides software for small and medium-sized businesses (SMBs) to manage their payroll and HR needs in one place.
Why Does PAYC Stand Out?
- Superior software functionality and low servicing costs are reflected in its best-in-class gross margin of 85.9%
- User-friendly software enables clients to ramp up spending quickly, leading to the speedy recovery of customer acquisition costs
- Highly efficient business model is illustrated by its impressive 27.9% operating margin
At $257.05 per share, Paycom trades at 7x forward price-to-sales. Is now the time to initiate a position? Find out in our full research report, it’s free.
Coinbase (COIN)
Consensus Price Target: $266.58 (8.4% implied return)
Widely regarded as the face of crypto, Coinbase (NASDAQ:COIN) is a blockchain infrastructure company updating the financial system with its trading, staking, stablecoin, and other payment solutions.
Why Should You Buy COIN?
- Monetization efforts are paying off as its average revenue per user has grown by 58.2% annually over the last two years
- Incremental sales significantly boosted profitability as its annual earnings per share growth of 64.5% over the last two years outstripped its revenue performance
- COIN is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders, and its improved cash conversion implies it’s becoming a less capital-intensive business
Coinbase’s stock price of $245.84 implies a valuation ratio of 19.1x forward EV/EBITDA. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
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 5 Growth Stocks for this month. 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 Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free.