3 of Wall Street's Favorite Stocks Walking a Fine Line

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 are three stocks where Wall Street may be overlooking some important risks and some alternatives with better fundamentals.

Strategic Education (STRA)

Consensus Price Target: $101.67 (33.9% implied return)

Formed through the merger of Strayer Education and Capella Education in 2018, Strategic Education (NASDAQ:STRA) is a career-focused higher education provider.

Why Do We Avoid STRA?

1. Sluggish trends in its international students suggest customers aren’t adopting its solutions as quickly as the company hoped
2. Incremental sales over the last five years were much less profitable as its earnings per share fell by 5.2% annually while its revenue grew
3. Forecasted free cash flow margin suggests the company will fail to improve its cash conversion over the next year

Strategic Education is trading at $75.91 per share, or 12.1x forward P/E. If you’re considering STRA for your portfolio, see our FREE research report to learn more.

Plug Power (PLUG)

Consensus Price Target: $2.75 (51.5% implied return)

Powering forklifts for Walmart’s distribution centers, Plug Power (NASDAQ:PLUG) provides hydrogen fuel cells used to power electric motors.

Why Does PLUG Worry Us?

1. Annual sales declines of 12.8% for the past two years show its products and services struggled to connect with the market during this cycle
2. Cash-burning history makes us doubt the long-term viability of its business model
3. Unfavorable liquidity position could lead to additional equity financing that dilutes shareholders

Plug Power’s stock price of $1.82 implies a valuation ratio of 2.7x forward price-to-sales. Check out our free in-depth research report to learn more about why PLUG doesn’t pass our bar.

PAR Technology (PAR)

Consensus Price Target: $59.11 (186% implied return)

Originally founded in 1968 as a defense contractor for the U.S. government, PAR Technology (NYSE:PAR) provides cloud-based software, payment processing, and hardware solutions that help restaurants manage everything from point-of-sale to customer loyalty programs.

Why Are We Wary of PAR?

1. Cash burn makes us question whether it can achieve sustainable long-term growth
2. Negative returns on capital show that some of its growth strategies have backfired
3. 14× net-debt-to-EBITDA ratio shows it’s overleveraged and increases the probability of shareholder dilution if things turn unexpectedly

At $20.70 per share, PAR Technology trades at 52x forward P/E. Dive into our free research report to see why there are better opportunities than PAR.

High-Quality Stocks for All Market Conditions

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 9 Market-Beating Stocks. 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 Kadant (+351% five-year return). Find your next big winner with StockStory today.