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.
Whatever the consensus opinion may be, our team at StockStory cuts through the noise by conducting independent analysis to determine a company’s long-term prospects. That said, here are three stocks facing legitimate challenges and some alternatives worth exploring instead.
TopBuild (BLD)
Consensus Price Target: $488.60 (-0.9% implied return)
Established in 2015 following a spinoff from Masco Corporation, TopBuild (NYSE:BLD) is a distributor and installer of insulation and other building products.
Why Does BLD Fall Short?
- Products and services are facing end-market challenges during this cycle, as seen in its flat sales over the last two years
- Organic sales performance over the past two years indicates the company may need to make strategic adjustments or rely on M&A to catalyze faster growth
- Earnings per share lagged its peers over the last two years as they only grew by 2.5% annually
TopBuild is trading at $493.19 per share, or 24.1x forward P/E. Dive into our free research report to see why there are better opportunities than BLD.
AMN Healthcare Services (AMN)
Consensus Price Target: $20.86 (1.8% implied return)
With a network of thousands of healthcare professionals ranging from nurses to physicians to executives, AMN Healthcare (NYSE:AMN) provides healthcare workforce solutions including temporary staffing, permanent placement, and technology platforms for hospitals and healthcare facilities across the United States.
Why Should You Dump AMN?
- Declining travelers on assignment over the past two years imply it may need to invest in improvements to get back on track
- Earnings per share have dipped by 10.5% annually over the past five years, which is concerning because stock prices follow EPS over the long term
- Diminishing returns on capital suggest its earlier profit pools are drying up
At $20.49 per share, AMN Healthcare Services trades at 27.6x forward P/E. Check out our free in-depth research report to learn more about why AMN doesn’t pass our bar.
Amentum (AMTM)
Consensus Price Target: $36.18 (1.9% implied return)
With operations spanning approximately 80 countries and a workforce of specialized engineers and technical experts, Amentum Holdings (NYSE:AMTM) provides advanced engineering and technology solutions to U.S. government agencies, allied governments, and commercial enterprises across defense, energy, and space sectors.
Why Does AMTM Worry Us?
- Annual sales growth of 2.4% over the last three years lagged behind its business services peers as its large revenue base made it difficult to generate incremental demand
- Forecasted revenue decline of 1.4% for the upcoming 12 months implies demand will fall off a cliff
- Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 2.3% for the last four years
Amentum’s stock price of $35.50 implies a valuation ratio of 14.8x forward P/E. If you’re considering AMTM for your portfolio, see our FREE research report to learn more.
Stocks We Like More
Check out the high-quality names we’ve flagged in 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 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-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.