Wall Street has set ambitious price targets for the stocks in this article. While this suggests attractive upside potential, it’s important to remain skeptical because analysts face institutional pressures that can sometimes lead to overly optimistic forecasts.
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 where Wall Street’s excitement appears well-founded and two where its enthusiasm might be excessive.
Two Stocks to Sell:
Dave & Buster's (PLAY)
Consensus Price Target: $26.22 (69.1% 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 Should You Sell PLAY?
- Lagging same-store sales over the past two years suggest it might have to change its pricing and marketing strategy to stimulate demand
- Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
- Unfavorable liquidity position could lead to additional equity financing that dilutes shareholders
At $15.51 per share, Dave & Buster's trades at 19.6x forward P/E. To fully understand why you should be careful with PLAY, check out our full research report (it’s free).
Amentum (AMTM)
Consensus Price Target: $36.64 (18.4% implied return)
With operations spanning approximately 80 countries and a workforce of specialized engineers and technical experts, Amentum Holdings (NYSE: AMTM) provides advanced engineering and technology solutions to U.S. government agencies, allied governments, and commercial enterprises across defense, energy, and space sectors.
Why Do We Pass on AMTM?
- The company has faced growth challenges as its 2.6% annual revenue increases over the last two years fell short of other business services companies
- Demand will likely fall over the next 12 months as Wall Street expects flat revenue
- Low free cash flow margin of 1.9% for the last five years gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders
Amentum’s stock price of $30.94 implies a valuation ratio of 13x forward P/E. Read our free research report to see why you should think twice about including AMTM in your portfolio.
One Stock to Buy:
Arthur J. Gallagher (AJG)
Consensus Price Target: $288.50 (33.1% implied return)
Founded in 1927 and operating in approximately 130 countries through direct operations and correspondent networks, Arthur J. Gallagher (NYSE: AJG) provides insurance brokerage, reinsurance, consulting, and third-party claims settlement services to businesses and individuals worldwide.
Why Will AJG Beat the Market?
- Market share has increased this cycle as its 17.9% annual revenue growth over the last two years was exceptional
- Earnings growth has massively outpaced its peers over the last five years as its EPS has compounded at 17.7% annually
- AJG is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
Arthur J. Gallagher is trading at $216.74 per share, or 16.5x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
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 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 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.
