3 Unpopular Stocks with Questionable Fundamentals

Wall Street has issued downbeat forecasts for the stocks in this article. These predictions are rare - financial institutions typically hesitate to say bad things about a company because it can jeopardize their other revenue-generating business lines like M&A advisory.

At StockStory, we look beyond the headlines with our independent analysis to determine whether these bearish calls are justified. That said, here are three stocks where the outlook is warranted and some alternatives with better fundamentals.

JFrog (FROG)

Consensus Price Target: $44.44 (2.5% implied return)

Named after the founders' affinity for frogs, JFrog (NASDAQ:FROG) provides a software-as-a-service platform that makes developing and releasing software easier and faster, especially for large teams.

Why Are We Wary of FROG?

1. Operating losses show it sacrificed profitability while scaling the business
2. Projected 6.6 percentage point decline in its free cash flow margin next year reflects the company’s plans to increase its investments to defend its market position

At $43.35 per share, JFrog trades at 9.3x forward price-to-sales. Check out our free in-depth research report to learn more about why FROG doesn’t pass our bar.

Adtalem (ATGE)

Consensus Price Target: $141.25 (10.3% implied return)

Formerly known as DeVry Education Group, Adtalem Global Education (NYSE:ATGE) is a global provider of workforce solutions and educational services.

Why Is ATGE Not Exciting?

1. Lackluster 9.7% annual revenue growth over the last two years indicates the company is losing ground to competitors
2. Projected 1.3 percentage point decline in its free cash flow margin next year reflects the company’s plans to increase its investments to defend its market position
3. Underwhelming 9.7% return on capital reflects management’s difficulties in finding profitable growth opportunities

Adtalem’s stock price of $128.10 implies a valuation ratio of 18.5x forward P/E. To fully understand why you should be careful with ATGE, check out our full research report (it’s free).

Astec (ASTE)

Consensus Price Target: $43 (9.7% implied return)

Inventing the first ever double-barrel hot-mix asphalt plant, Astec (NASDAQ:ASTE) provides machines and equipment for building roads, processing raw materials, and producing concrete.

Why Do We Think ASTE Will Underperform?

1. Backlog has dropped by 28.1% on average over the past two years, suggesting it’s losing orders as competition picks up
2. Estimated sales growth of 3.5% for the next 12 months is soft and implies weaker demand
3. 8.1 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position

Astec is trading at $39.21 per share, or 14x forward P/E. Dive into our free research report to see why there are better opportunities than ASTE.

High-Quality Stocks for All Market Conditions

Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.

While this has caused many investors to adopt a "fearful" wait-and-see approach, we’re leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years.

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-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free.