3 Unpopular Stocks We Steer Clear Of

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 three stocks where the outlook is warranted and some alternatives with better fundamentals.

RE/MAX (RMAX)

Consensus Price Target: $9 (5% implied return)

Short for Real Estate Maximums, RE/MAX (NYSE:RMAX) operates a real estate franchise network spanning over 100 countries and territories.

Why Do We Avoid RMAX?

1. Sluggish trends in its agents suggest customers aren’t adopting its solutions as quickly as the company hoped
2. Performance over the past five years shows its incremental sales were much less profitable, as its earnings per share fell by 6.7% annually
3. Low returns on capital reflect management’s struggle to allocate funds effectively

RE/MAX is trading at $8.57 per share, or 6.7x forward P/E. To fully understand why you should be careful with RMAX, check out our full research report (it’s free for active Edge members).

MYR Group (MYRG)

Consensus Price Target: $209.25 (1.1% implied return)

Constructing electrical and phone lines in the American Midwest dating back to the 1890s, MYR Group (NASDAQ:MYRG) is a specialty contractor in the electrical construction industry.

Why Do We Pass on MYRG?

1. Demand cratered as it couldn’t win new orders over the past two years, leading to an average 2.4% decline in its backlog
2. Earnings per share fell by 4.6% annually over the last two years while its revenue grew, showing its incremental sales were much less profitable
3. Diminishing returns on capital suggest its earlier profit pools are drying up

At $207 per share, MYR Group trades at 27.6x forward P/E. Read our free research report to see why you should think twice about including MYRG in your portfolio.

Global Industrial (GIC)

Consensus Price Target: $38 (8.8% implied return)

Formerly known as Systemax, Global Industrial (NYSE:GIC) distributes industrial and commercial products to businesses and institutions.

Why Are We Wary of GIC?

1. Muted 6.9% annual revenue growth over the last two years shows its demand lagged behind its industrials peers
2. Incremental sales over the last two years were much less profitable as its earnings per share fell by 2.3% annually while its revenue grew
3. Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability

Global Industrial’s stock price of $34.94 implies a valuation ratio of 17.9x forward P/E. Dive into our free research report to see why there are better opportunities than GIC.

Stocks We Like More

Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.

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