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.
Luckily for you, we at StockStory have no conflicts of interest - our sole job is to help you find genuinely promising companies. That said, here is one stock likely to meet or exceed Wall Street’s lofty expectations and two where analysts may be overlooking some important risks.
Two Stocks to Sell:
Amplitude (AMPL)
Consensus Price Target: $15.67 (45.1% implied return)
Born from the realization that companies were flying blind when it came to understanding user behavior in their digital products, Amplitude (NASDAQ:AMPL) provides a digital analytics platform that helps businesses understand how people use their digital products to improve user experiences and drive revenue growth.
Why Does AMPL Fall Short?
- Products, pricing, or go-to-market strategy may need some adjustments as its 9.9% average billings growth over the last year was weak
- Net revenue retention rate of 100% trails the industry benchmark of 110%+ and shows it has a tough time increasing customer spending
- Historical operating margin losses point to an inefficient cost structure
Amplitude’s stock price of $10.80 implies a valuation ratio of 4x forward price-to-sales. If you’re considering AMPL for your portfolio, see our FREE research report to learn more.
CSG (CSGS)
Consensus Price Target: $77.29 (25.3% implied return)
Powering billions of critical customer interactions annually, CSG Systems (NASDAQ:CSGS) provides cloud-based software platforms that help companies manage customer interactions, process payments, and monetize their services.
Why Do We Avoid CSGS?
- Sales trends were unexciting over the last two years as its 2.6% annual growth was below the typical business services company
- Revenue base of $1.21 billion puts it at a disadvantage compared to larger competitors exhibiting economies of scale
- Diminishing returns on capital from an already low starting point show that neither management’s prior nor current bets are going as planned
CSG is trading at $61.69 per share, or 12.5x forward P/E. Check out our free in-depth research report to learn more about why CSGS doesn’t pass our bar.
One Stock to Watch:
Freshworks (FRSH)
Consensus Price Target: $20.69 (54.8% implied return)
Starting as a customer service solution before expanding into a comprehensive software suite, Freshworks (NASDAQ:FRSH) provides AI-powered software-as-a-service solutions that help companies manage customer service, IT support, sales, and marketing functions.
Why Could FRSH Be a Winner?
- ARR growth averaged 20.1% over the last year, showing customers are willing to take multi-year bets on its software
- Prominent and differentiated software culminates in a stellar gross margin of 84.6%
- Operating margin expanded by 13.2 percentage points over the last year as it scaled and became more efficient
At $13.37 per share, Freshworks trades at 4.4x forward price-to-sales. Is now the time to initiate a position? See for yourself in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking out our Top 6 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-small-cap company Comfort Systems (+782% 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
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