Wall Street has issued downbeat forecasts for the stocks in this article. These predictions are rare - financial institutions typically hesitate to say bad things about a company because it can jeopardize their other revenue-generating business lines like 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. That said, here are three stocks where the outlook is warranted and some alternatives with better fundamentals.
Zoom (ZM)
Consensus Price Target: $116.35 (9.4% implied return)
Once the verb that defined remote work during the pandemic ("let's Zoom later"), Zoom (NASDAQ:ZM) provides a cloud-based platform for video meetings, phone calls, team chat, and collaboration tools that helps businesses and individuals connect virtually.
Why Is ZM Risky?
- Customers had second thoughts about committing to its platform over the last year as its average billings growth of 4.8% underwhelmed
- Platform has low switching costs as its net revenue retention rate of 98.3% demonstrates high turnover
- Anticipated sales growth of 4.2% for the next year implies demand will be shaky
At $106.35 per share, Zoom trades at 6.3x forward price-to-sales. If you’re considering ZM for your portfolio, see our FREE research report to learn more.
Baxter (BAX)
Consensus Price Target: $28.73 (8.9% implied return)
With a history dating back to 1931 and products used in over 100 countries, Baxter International (NYSE:BAX) provides essential healthcare products including dialysis therapies, IV solutions, infusion systems, surgical products, and patient monitoring technologies to hospitals and clinics worldwide.
Why Are We Out on BAX?
- Constant currency growth was below our standards over the past two years, suggesting it might need to invest in product improvements to get back on track
- Earnings per share decreased by more than its revenue over the last five years, showing each sale was less profitable
- Push for growth has led to negative returns on capital, signaling value destruction
Baxter is trading at $26.39 per share, or 12.6x forward P/E. Read our free research report to see why you should think twice about including BAX in your portfolio.
Regions Financial (RF)
Consensus Price Target: $32.93 (8.9% implied return)
Tracing its roots back to 1971 and operating in a region known as the "heart of Dixie," Regions Financial (NYSE:RF) is a financial holding company that provides banking services, wealth management, and specialty financial solutions across the South, Midwest, and Texas.
Why Are We Hesitant About RF?
- Annual net interest income growth of 5.3% over the last five years was below our standards for the banking sector
- Estimated net interest income growth of 4.1% for the next 12 months is soft and implies weaker demand
- Incremental sales over the last five years were less profitable as its earnings per share were flat while its revenue grew
Regions Financial’s stock price of $30.25 implies a valuation ratio of 1.4x forward P/B. To fully understand why you should be careful with RF, check out our full research report (it’s free).
High-Quality Stocks for All Market Conditions
ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI is taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies.
Our AI system flagged Palantir before it ran 1,662% between October 2022 and February 2026. AppLovin before it ran 753% between February 2024 and February 2026. Nvidia before it ran 1,178% between January 2023 and February 2026. Each week it produces 6 new names that pass the same tests. Get Our Top 6 Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.