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.

Accurately determining a company’s long-term prospects isn’t easy, especially when sentiment is weak. That’s where StockStory comes in - to help you find attractive investment candidates backed by unbiased research. Keeping that in mind, here is one stock where Wall Street’s pessimism is creating a buying opportunity and two facing legitimate challenges.

Two Stocks to Sell:

Microchip Technology (MCHP)

Consensus Price Target: $86.63 (16.5% implied return)

Spun out from General Instrument in 1987, Microchip Technology (NASDAQ: MCHP) is a leading provider of microcontrollers and integrated circuits used mainly in the automotive world, especially in electric vehicles and their charging devices.

Why Should You Dump MCHP?

1. Annual sales declines of 3.8% for the past five years show its products and services struggled to connect with the market during this cycle
2. Performance over the past five years shows each sale was less profitable as its earnings per share dropped by 17.7% annually, worse than its revenue
3. Capital intensity has ramped up over the last five years as its free cash flow margin decreased by 15.9 percentage points

At $74.36 per share, Microchip Technology trades at 31.2x forward P/E. To fully understand why you should be careful with MCHP, check out our full research report (it’s free).

Regions Financial (RF)

Consensus Price Target: $30.66 (0.3% implied return)

Tracing its roots back to 1971 and operating in a region known as the "heart of Dixie," Regions Financial (NYSE: RF) is a financial holding company that provides banking services, wealth management, and specialty financial solutions across the South, Midwest, and Texas.

Why Are We Hesitant About RF?

1. Net interest income trends were unexciting over the last five years as its 5.1% annual growth was below the typical banking firm
2. Concessions to defend its market share have ramped up over the last two years as its net interest margin decreased by 38.2 basis points (100 basis points = 1 percentage point)
3. Earnings growth over the last two years fell short of the peer group average as its EPS only increased by 2.2% annually

Regions Financial’s stock price of $30.58 implies a valuation ratio of 1.4x forward P/B. If you’re considering RF for your portfolio, see our FREE research report to learn more.

One Stock to Buy:

Alphabet (GOOGL)

Consensus Price Target: $369.29 (13.9% implied return)

Started by Stanford students Larry Page and Sergey Brin in a Menlo Park garage, Alphabet (NASDAQ: GOOGL) is the parent company of the eponymous Google Search engine, Google Cloud Platform, and YouTube.

Why Are We Bullish on GOOGL?

1. Alphabet’s dominant Google Search sits on the pantheon of the best businesses ever. This is reflected in its robust long-term revenue growth and elite operating margin.
2. The company’s profit margins have become even higher over time, speaking to its scale advantages and operating efficiency not only in its core Search business but also in Google Cloud Platform and YouTube.
3. Revenue growth and increasing operating margins are the key ingredients for strong EPS growth. Google has these, and when also factoring in its share repurchases, you can see why EPS has exploded over the long term.

Alphabet is trading at $324.33 per share, or 28.3x forward price-to-earnings. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.

Stocks We Like Even More

The market’s up big this year - but there’s a catch. Just 4 stocks account for half the S&P 500’s entire gain. That kind of concentration makes investors nervous, and for good reason. While everyone piles into the same crowded names, smart investors are hunting quality where no one’s looking - and paying a fraction of the price. 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 Exlservice (+354% five-year return). Find your next big winner with StockStory today.