1 of Wall Street's Favorite Stock to Target This Week and 2 We Question

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 where Wall Street’s excitement appears well-founded and two where consensus estimates seem disconnected from reality.

Two Stocks to Sell:

Clarus (CLAR)

Consensus Price Target: $4.15 (22.3% implied return)

Initially a financial services business, Clarus (NASDAQ:CLAR) designs, manufactures, and distributes outdoor equipment and lifestyle products.

Why Do We Think CLAR Will Underperform?

1. Lackluster 4.2% annual revenue growth over the last five years indicates the company is losing ground to competitors
2. Cash-burning tendencies make us wonder if it can sustainably generate shareholder value
3. Eroding returns on capital from an already low base indicate that management’s recent investments are destroying value

Clarus’s stock price of $3.39 implies a valuation ratio of 22.4x forward P/E. To fully understand why you should be careful with CLAR, check out our full research report (it’s free for active Edge members).

Dave & Buster's (PLAY)

Consensus Price Target: $26.50 (63.1% implied return)

Founded by a former game parlor and bar operator, Dave & Buster’s (NASDAQ:PLAY) operates a chain of arcades providing immersive entertainment experiences.

Why Is PLAY Risky?

1. Weak same-store sales trends over the past two years suggest there may be few opportunities in its core markets to open new locations
2. Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
3. Limited cash reserves may force the company to seek unfavorable financing terms that could dilute shareholders

At $16.24 per share, Dave & Buster's trades at 20.2x forward P/E. If you’re considering PLAY for your portfolio, see our FREE research report to learn more.

One Stock to Buy:

WEBTOON (WBTN)

Consensus Price Target: $15.81 (21.6% implied return)

Pioneering a vertical-scrolling format optimized for mobile devices, WEBTOON Entertainment (NASDAQ:WBTN) operates a global platform where creators publish serialized web-comics and web-novels that users can read in bite-sized episodes.

Why Are We Backing WBTN?

1. Offerings and unique value proposition resonate with customers, as seen in its above-market 7.2% annual sales growth over the last two years
2. Adjusted operating margin improved by 11 percentage points over the last four years as it eliminated redundant costs
3. Incremental sales significantly boosted profitability as its annual earnings per share growth of 75.9% over the last two years outstripped its revenue performance

WEBTOON is trading at $13.00 per share, or 57.5x forward EV-to-EBITDA. Is now a good time to buy? See for yourself in our comprehensive research report, it’s free for active Edge members .

Stocks We Like Even More

The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. Check out the high-quality names we’ve flagged in 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 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-micro-cap company Tecnoglass (+1,754% 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.