1 of Wall Street's Favorite Stock on Our Buy List and 2 We Ignore

Wall Street is overwhelmingly bullish on the stocks in this article, with price targets suggesting significant upside potential. However, it’s worth remembering that analysts rarely issue sell ratings, partly because their firms often seek other business from the same companies they cover.

Unlike the investment banks, we created StockStory to provide independent analysis that helps you determine which companies are truly worth following. That said, here is one stock likely to meet or exceed Wall Street’s lofty expectations and two where its enthusiasm might be excessive.

Two Stocks to Sell:

VSE Corporation (VSEC)

Consensus Price Target: $207.07 (21.6% implied return)

With roots dating back to 1959 and a strategic focus on extending the life of transportation assets, VSE Corporation (NASDAQ:VSEC) provides aftermarket parts distribution and maintenance, repair, and overhaul services for aircraft and vehicle fleets in commercial and government markets.

Why Does VSEC Worry Us?

1. Gross margin of 17.3% is below its competitors, leaving less money to invest in areas like marketing and R&D
2. Negative free cash flow raises questions about the return timeline for its investments
3. Below-average returns on capital indicate management struggled to find compelling investment opportunities

VSE Corporation is trading at $170.31 per share, or 41.9x forward P/E. Read our free research report to see why you should think twice about including VSEC in your portfolio.

LGI Homes (LGIH)

Consensus Price Target: $76.17 (71.5% implied return)

Based in Texas, LGI Homes (NASDAQ:LGIH) is a homebuilding company specializing in constructing affordable, entry-level single-family homes in desirable communities across the United States.

Why Do We Pass on LGIH?

1. Demand cratered as it couldn’t win new orders over the past two years, leading to an average 10.4% decline in its backlog
2. Diminishing returns on capital suggest its earlier profit pools are drying up
3. Depletion of cash reserves could lead to a fundraising event that triggers shareholder dilution

At $44.42 per share, LGI Homes trades at 10.6x forward P/E. To fully understand why you should be careful with LGIH, check out our full research report (it’s free for active Edge members).

One Stock to Buy:

Chipotle (CMG)

Consensus Price Target: $43.18 (39.1% implied return)

Born from a desire to offer quick meals with fresh, flavorful ingredients, Chipotle (NYSE:CMG) is a fast-food chain known for its healthy, Mexican-inspired cuisine and customizable dishes.

Why Should You Buy CMG?

1. Fast expansion of new restaurants to reach markets with few or no locations is justified by its same-store sales growth
2. Same-store sales growth over the past two years shows it’s successfully drawing diners into its restaurants
3. Dominant market position is represented by its $11.79 billion in revenue and gives it fixed cost leverage when sales grow

Chipotle’s stock price of $31.05 implies a valuation ratio of 26.4x forward P/E. Is now a good time to buy? See for yourself in our in-depth research report, it’s free for active Edge members.

Stocks We Like Even More

If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.

Don’t wait for the next volatility shock. 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 244% over the last five years (as of June 30, 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% 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

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.