When Wall Street turns bearish on a stock, it’s worth paying attention. These calls stand out because analysts rarely issue grim ratings on companies for fear their firms will lose out in other business lines such as 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.
Saia (SAIA)
Consensus Price Target: $452.55 (5.2% implied return)
Pivoting its business model after realizing there was more success in delivering produce than selling it, Saia (NASDAQ: SAIA) is a provider of freight transportation solutions.
Why Are We Cautious About SAIA?
- Disappointing tons shipped over the past two years imply it may need to invest in improvements to get back on track
- Low free cash flow margin of -0.1% for the last five years gives it little breathing room, constraining its ability to self-fund growth or return capital to shareholders
- Waning returns on capital imply its previous profit engines are losing steam
Saia is trading at $430.18 per share, or 35.3x forward P/E. To fully understand why you should be careful with SAIA, check out our full research report (it’s free).
Atkore (ATKR)
Consensus Price Target: $84.33 (8.4% implied return)
Protecting the things that power our world, Atkore (NYSE: ATKR) designs and manufactures electrical safety products.
Why Should You Dump ATKR?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 7.8% annually over the last two years
- Free cash flow margin dropped by 9.2 percentage points over the last five years, implying the company became more capital intensive as competition picked up
- Shrinking returns on capital suggest that increasing competition is eating into the company’s profitability
At $77.83 per share, Atkore trades at 13.7x forward P/E. Read our free research report to see why you should think twice about including ATKR in your portfolio.
Performance Food Group (PFGC)
Consensus Price Target: $119.42 (8.9% implied return)
With a massive network spanning 155 distribution centers and delivering over 250,000 different food products, Performance Food Group (NYSE: PFGC) distributes food and food-related products to over 300,000 restaurants, convenience stores, theaters, and institutions across North America.
Why Do We Think PFGC Will Underperform?
- Average unit sales growth of 6.6% over the past two years reflects steady demand for its products
- Lacking free cash flow generation means it has few chances to reinvest for growth, repurchase shares, or distribute capital
- Returns on capital are increasing as management makes relatively better investment decisions
Performance Food Group’s stock price of $109.69 implies a valuation ratio of 20.4x forward P/E. Check out our free in-depth research report to learn more about why PFGC doesn’t pass our bar.
Stocks We Like More
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE.
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.
