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 two stocks where you should be greedy instead of fearful and one where the skepticism is well-placed.
One Stock to Sell:
MGIC Investment (MTG)
Consensus Price Target: $31 (9.7% implied return)
Founded in 1957 when the modern mortgage insurance industry was in its infancy, MGIC Investment (NYSE: MTG) provides private mortgage insurance that protects lenders when homebuyers default on their loans, enabling borrowers to purchase homes with smaller down payments.
Why Does MTG Give Us Pause?
- Net premiums earned contracted by 1.5% annually over the last five years, showing unfavorable market dynamics this cycle
- Estimated sales for the next 12 months are flat and imply a softer demand environment
- Earnings growth over the last two years fell short of the peer group average as its EPS only increased by 8.4% annually
MGIC Investment is trading at $28.26 per share, or 1.1x forward P/B. If you’re considering MTG for your portfolio, see our FREE research report to learn more.
Two Stocks to Buy:
Datadog (DDOG)
Consensus Price Target: $286.26 (6.6% implied return)
Named after a database the founders had to painstakingly look after at their previous company, Datadog (NASDAQ: DDOG) provides a software platform that helps organizations monitor and secure their cloud applications, infrastructure, and services.
Why Are We Bullish on DDOG?
- ARR trends over the last year show it’s maintaining a steady flow of long-term contracts that contribute positively to its revenue predictability
- Market share will likely rise over the next 12 months as its expected revenue growth of 24.5% is robust
- Well-designed software integrates seamlessly with other workflows, enabling swift payback periods on marketing expenses and customer growth at scale
At $268.44 per share, Datadog trades at 20.2x forward price-to-sales. Is now the right time to buy? Find out in our full research report, it’s free.
Dell (DELL)
Consensus Price Target: $579.36 (7.1% implied return)
Founded by Michael Dell in his University of Texas dorm room in 1984 with just $1,000, Dell Technologies (NYSE: DELL) provides hardware, software, and services that help organizations build their IT infrastructure, manage cloud environments, and enable digital transformation.
Why Is DELL a Good Business?
- Annual revenue growth of 28.3% over the last two years was superb and indicates its market share increased during this cycle
- Share repurchases have amplified shareholder returns as its annual earnings per share growth of 59.3% exceeded its revenue gains over the last two years
- Improving returns on capital reflect management’s ability to monetize investments
Dell’s stock price of $540.75 implies a valuation ratio of 19.3x forward P/E. Is now a good time to buy? See for yourself in our in-depth research report, it’s free.
Stocks We Like Even More
ONE MORE THING: Top 6 Stocks for This Week. This market is separating quality stocks from expensive ones fast. AI is taking down whole sectors with no warning. In a rotation this fast, you need more than a list of good companies.
Our AI system flagged Palantir before it ran 1,662% between October 2022 and February 2026. AppLovin before it ran 753% between February 2024 and February 2026. Nvidia before it ran 1,178% between January 2023 and February 2026. Each week it produces 6 new names that pass the same tests. Get Our Top 6 Stocks for Free HERE.
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 Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.
