1 of Wall Street's Favorite Stock with Promising Prospects and 2 to Be Wary Of

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.

Unlike the investment banks, we created StockStory to provide independent analysis that helps you determine which companies are truly worth following. Keeping that in mind, here is one stock likely to meet or exceed Wall Street’s lofty expectations and two where consensus estimates seem disconnected from reality.

Two HealthcareStocks to Sell:

RadNet (RDNT)

Consensus Price Target: $72 (24.1% implied return)

With over 350 imaging facilities across seven states and a growing artificial intelligence division, RadNet (NASDAQ:RDNT) operates a network of outpatient diagnostic imaging centers across the United States, offering services like MRI, CT scans, PET scans, mammography, and X-rays.

Why Are We Wary of RDNT?

1. Subscale operations are evident in its revenue base of $1.87 billion, meaning it has fewer distribution channels than its larger rivals
2. 3.9 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
3. Below-average returns on capital indicate management struggled to find compelling investment opportunities

RadNet’s stock price of $58.01 implies a valuation ratio of 109.4x forward P/E. To fully understand why you should be careful with RDNT, check out our full research report (it’s free).

10x Genomics (TXG)

Consensus Price Target: $12.92 (21.3% implied return)

Founded in 2012 by scientists seeking to overcome limitations in traditional biological research methods, 10x Genomics (NASDAQ:TXG) develops instruments, consumables, and software that enable researchers to analyze biological systems at single-cell resolution and spatial context.

Why Do We Avoid TXG?

1. Cash-burning history makes us doubt the long-term viability of its business model
2. Negative returns on capital show that some of its growth strategies have backfired, and its decreasing returns suggest its historical profit centers are aging
3. Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned

10x Genomics is trading at $10.65 per share, or 2.3x forward price-to-sales. Check out our free in-depth research report to learn more about why TXG doesn’t pass our bar.

One Healthcare Stock to Watch:

Centene (CNC)

Consensus Price Target: $76.50 (38.4% implied return)

Serving nearly 1 in 15 Americans through its government healthcare programs, Centene (NYSE:CNC) is a healthcare company that manages government-sponsored health insurance programs like Medicaid and Medicare for low-income and complex-needs populations.

Why Could CNC Be a Winner?

1. Offerings and unique value proposition resonate with customers, as seen in its above-market 15.5% annual sales growth over the last five years
2. Dominant market position is represented by its $169.3 billion in revenue, which gives it negotiating power over membership pricing and reimbursement rates
3. Earnings growth has trumped its peers over the last five years as its EPS has compounded at 14.8% annually

At $55.28 per share, Centene trades at 7.2x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.

Stocks We Like Even More

Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.

While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 5 Strong Momentum 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-micro-cap company Kadant (+351% 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.