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. Keeping that in mind, here is one stock where you should be greedy instead of fearful and two facing legitimate challenges.
Two Stocks to Sell:
Five9 (FIVN)
Consensus Price Target: $35 (5.1% implied return)
Taking its name from the "five nines" (99.999%) standard for optimal service reliability in telecommunications, Five9 (NASDAQ:FIVN) provides cloud-based software that enables businesses to run their contact centers with tools for customer service, sales, and marketing across multiple communication channels.
Why Should You Sell FIVN?
- Offerings struggled to generate meaningful interest as its average billings growth of 9.1% over the last year did not impress
- Anticipated sales growth of 10.5% for the next year implies demand will be shaky
- Sky-high servicing costs result in an inferior gross margin of 54.9% that must be offset through increased usage
Five9’s stock price of $33.31 implies a valuation ratio of 2.1x forward price-to-sales. Check out our free in-depth research report to learn more about why FIVN doesn’t pass our bar.
eBay (EBAY)
Consensus Price Target: $116.15 (12.6% implied return)
Originally known as the first online auction site, eBay (NASDAQ:EBAY) is one of the world’s largest online marketplaces.
Why Do We Think Twice About EBAY?
- Competition may be pulling attention away from its platform as its 1.3% average growth in active buyers was choppy
- Demand will likely be soft over the next 12 months as Wall Street’s estimates imply tepid growth of 7.8%
- Expenses have increased as a percentage of revenue over the last few years as its EBITDA margin fell by 1.9 percentage points
eBay is trading at $103.19 per share, or 13.2x forward EV/EBITDA. If you’re considering EBAY for your portfolio, see our FREE research report to learn more.
One Stock to Buy:
Samsara (IOT)
Consensus Price Target: $52.48 (30.9% implied return)
From sensors on vehicles to AI-powered cameras that help prevent accidents, Samsara (NYSE:IOT) is a cloud-based Internet of Things platform that helps businesses improve the safety, efficiency, and sustainability of their physical operations.
What Makes IOT Stand Out?
- Ability to secure long-term commitments with customers is evident in its 29.5% ARR growth over the last year
- Forecasted revenue growth of 21% for the next 12 months indicates its momentum over the last two years is sustainable
- Fast payback periods on sales and marketing expenses allow the company to invest heavily and onboard many customers concurrently
At $40.08 per share, Samsara trades at 10.6x forward price-to-sales. Is now the time to initiate a position? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,552% between June 2020 and June 2025). Find your next big winner with StockStory today.