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. That said, here are two stocks where Wall Street’s pessimism is creating a buying opportunity and one where the skepticism is well-placed.

One Stock to Sell:

Lamb Weston (LW)

Consensus Price Target: $55.25 (0.8% implied return)

Best known for its Grown in Idaho brand, Lamb Weston (NYSE: LW) produces and distributes potato products such as frozen french fries and mashed potatoes.

Why Does LW Worry Us?

1. Core business is underperforming as its organic revenue has disappointed over the past two years, suggesting it might need acquisitions to stimulate growth
2. Projected sales decline of 1.4% for the next 12 months points to a tough demand environment ahead
3. Earnings per share have contracted by 33% annually over the last three years, a headwind for returns as stock prices often echo long-term EPS performance

Lamb Weston is trading at $54.81 per share, or 17.7x forward P/E. Read our free research report to see why you should think twice about including LW in your portfolio.

Two Stocks to Buy:

Philip Morris (PM)

Consensus Price Target: $203.80 (6.5% implied return)

Founded in 1847, Philip Morris International (NYSE: PM) manufactures and sells a wide range of tobacco and nicotine-containing products, including cigarettes, heated tobacco products, and oral nicotine pouches.

Why Will PM Beat the Market?

1. Products command premium prices and lead to a best-in-class gross margin of 67%
2. Disciplined cost controls and effective management resulted in a strong two-year operating margin of 37%, and its operating leverage amplified its profits over the last year
3. Strong free cash flow margin of 26.6% enables it to reinvest or return capital consistently, and its growing cash flow gives it even more resources to deploy

Philip Morris’s stock price of $191.38 implies a valuation ratio of 21.6x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.

Bowhead Specialty (BOW)

Consensus Price Target: $34.43 (2% implied return)

Named after the Arctic bowhead whale known for navigating challenging waters, Bowhead Specialty Holdings (NYSE: BOW) is a specialty insurance company that provides customized coverage for complex and high-risk commercial sectors.

Why Are We Bullish on BOW?

1. Market penetration was impressive this cycle as its net premiums earned expanded by 30.3% annually over the last two years
2. Notable projected revenue growth of 22.2% for the next 12 months hints at market share gains
3. Annual book value per share growth of 17.6% over the last two years was superb and indicates its capital strength increased during this cycle

At $33.76 per share, Bowhead Specialty trades at 2.2x forward P/B. Is now the time to initiate a position? See for yourself in our full research report, it’s free.

Stocks We Like Even More

WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.

But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating 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-small-cap company Exlservice (+271% between June 2020 and June 2025). Find your next big winner with StockStory today.