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.
At StockStory, we look beyond the headlines with our independent analysis to determine whether these bullish calls are justified. Keeping that in mind, here are two stocks likely to meet or exceed Wall Street’s lofty expectations and one where consensus estimates seem disconnected from reality.
One Stock to Sell:
Kimball Solutions (KE)
Consensus Price Target: $34.25 (31.8% implied return)
Founded in 1961, Kimball Solutions (NASDAQ: KE) is a global contract manufacturer specializing in electronics and manufacturing solutions for automotive, medical, and industrial markets.
Why Are We Out on KE?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 8.6% annually over the last two years
- Falling earnings per share over the last five years has some investors worried as stock prices ultimately follow EPS over the long term
- Poor free cash flow margin of -0.1% for the last five years limits its freedom to invest in growth initiatives, execute share buybacks, or pay dividends
Kimball Solutions is trading at $26.00 per share, or 14.6x forward P/E. Dive into our free research report to see why there are better opportunities than KE.
Two Stocks to Watch:
Freshworks (FRSH)
Consensus Price Target: $14.38 (14.2% 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?
- 24% annual revenue growth over the last five years surpassed the sector average as its software resonated with customers
- Superior software functionality and low servicing costs lead to a stellar gross margin of 85%
- FRSH is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
Freshworks’s stock price of $12.60 implies a valuation ratio of 3.1x forward price-to-sales. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.
Palomar Holdings (PLMR)
Consensus Price Target: $163.17 (27.4% implied return)
Founded in 2013 to fill gaps in catastrophe insurance markets, Palomar Holdings (NASDAQ: PLMR) is a specialty insurance provider that offers property and casualty insurance products in underserved markets, with a focus on earthquake coverage.
Why Will PLMR Beat the Market?
- Market penetration was impressive this cycle as its net premiums earned expanded by 56.8% annually over the last two years
- Earnings growth has massively outpaced its peers over the last two years as its EPS has compounded at 42.9% annually
- Annual book value per share growth of 32.6% over the past two years was outstanding, reflecting strong capital accumulation this cycle
At $128.06 per share, Palomar Holdings trades at 3.2x forward P/B. Is now the time to initiate a position? Find out in our full research report, it’s free.
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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-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.
