3 Unpopular Stocks We Find Risky
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 are three stocks where the outlook is warranted and some alternatives with better fundamentals.
BJ's (BJRI)
Consensus Price Target: $38.88 (3.7% implied return)
Founded in 1978 in California, BJ’s Restaurants (NASDAQ:BJRI) is a chain of restaurants whose menu features classic American dishes, often with a twist.
Why Do We Pass on BJRI?
- Weak same-store sales trends over the past two years suggest there may be few opportunities in its core markets to open new restaurants
- Challenging supply chain dynamics and bad unit economics are reflected in its low gross margin of 14.7%
- Underwhelming 3% return on capital reflects management’s difficulties in finding profitable growth opportunities
BJ’s stock price of $37.51 implies a valuation ratio of 16.7x forward P/E. Read our free research report to see why you should think twice about including BJRI in your portfolio.
Marcus & Millichap (MMI)
Consensus Price Target: $29 (2.2% implied return)
Founded in 1971, Marcus & Millichap (NYSE:MMI) specializes in commercial real estate investment sales, financing, research, and advisory services.
Why Do We Think MMI Will Underperform?
- Lackluster 1.3% annual revenue growth over the last five years indicates the company is losing ground to competitors
- Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 3% for the last two years
- Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
At $28.37 per share, Marcus & Millichap trades at 59x forward P/E. Check out our free in-depth research report to learn more about why MMI doesn’t pass our bar.
ASGN (ASGN)
Consensus Price Target: $48.67 (9.8% implied return)
Evolving from its roots in IT staffing to become a high-end technology consulting powerhouse, ASGN (NYSE:ASGN) provides specialized IT consulting services and staffing solutions to Fortune 1000 companies and U.S. federal government agencies.
Why Do We Steer Clear of ASGN?
- Sales tumbled by 6.2% annually over the last two years, showing market trends are working against its favor during this cycle
- Demand will likely be weak over the next 12 months as Wall Street expects flat revenue
- Performance over the past five years shows its incremental sales were less profitable as its earnings per share were flat
ASGN is trading at $44.31 per share, or 9.5x forward P/E. To fully understand why you should be careful with ASGN, check out our full research report (it’s free for active Edge members).
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 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
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