1 of Wall Street's Favorite Stock to Target This Week and 2 That Underwhelm

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.

Luckily for you, we at StockStory have no conflicts of interest - our sole job is to help you find genuinely promising companies. Keeping that in mind, here is one stock likely to meet or exceed Wall Street’s lofty expectations and two where analysts may be overlooking some important risks.

Two Stocks to Sell:

Karat Packaging (KRT)

Consensus Price Target: $33 (43.4% implied return)

Founded as Lollicup, Karat Packaging (NASDAQ: KRT) distributes and manufactures environmentally-friendly disposable foodservice packaging solutions.

Why Do We Think Twice About KRT?

1. Annual revenue growth of 4.2% over the last two years was below our standards for the industrials sector
2. Earnings per share fell by 2.9% annually over the last two years while its revenue grew, partly because it diluted shareholders
3. Lacking free cash flow generation means it has few chances to reinvest for growth, repurchase shares, or distribute capital

Karat Packaging’s stock price of $23.01 implies a valuation ratio of 14.8x forward P/E. Check out our free in-depth research report to learn more about why KRT doesn’t pass our bar.

Custom Truck One Source (CTOS)

Consensus Price Target: $7.42 (20.8% implied return)

Inspired by a family gas station, Custom Truck One Source (NYSE:CTOS) is a distributor of trucks and heavy equipment.

Why Is CTOS Not Exciting?

1. 4.1% annual revenue growth over the last two years was slower than its industrials peers
2. Earnings per share have dipped by 52% annually over the past two years, which is concerning because stock prices follow EPS over the long term
3. Free cash flow margin shrank by 24.4 percentage points over the last five years, suggesting the company is consuming more capital to stay competitive

Custom Truck One Source is trading at $6.14 per share, or 204.3x forward P/E. If you’re considering CTOS for your portfolio, see our FREE research report to learn more.

One Stock to Buy:

Old National Bank (ONB)

Consensus Price Target: $26.42 (28.9% implied return)

Tracing its roots back to 1834 when Andrew Jackson was president, Old National Bancorp (NASDAQ:ONB) is a bank holding company that provides commercial and consumer loans, deposit services, wealth management, and treasury solutions primarily throughout the Midwest region.

Why Are We Bullish on ONB?

1. Annual net interest income growth of 25.5% over the past five years was outstanding, reflecting market share gains this cycle
2. Projected net interest income growth of 39.3% for the next 12 months is above its five-year trend, pointing to accelerating demand
3. Earnings growth has trumped its peers over the last five years as its EPS has compounded at 10.3% annually

At $20.50 per share, Old National Bank trades at 1x forward P/B. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free for active Edge members .

High-Quality Stocks for All Market Conditions

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.

The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 6 Stocks for this week. 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-small-cap company Exlservice (+354% 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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