Wall Street’s bearish price targets for the stocks in this article signal serious concerns. Such forecasts are uncommon in an industry where maintaining cordial corporate relationships often trumps delivering the hard truth.
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.
Asana (ASAN)
Consensus Price Target: $9.13 (-0.8% implied return)
Born from the founders' frustration with the inefficiencies of email-based collaboration at Facebook, Asana (NYSE:ASAN) provides a work management platform that helps organizations track projects, set goals, and manage workflows in a centralized digital workspace.
Why Do We Avoid ASAN?
- Underwhelming ARR growth of 9.6% over the last year suggests the company faced challenges in acquiring and retaining long-term customers
- Customers have churned over the last year due to the commoditized nature of its software, as reflected in its 96% net revenue retention rate
- Prolonged sales cycles signal certain parts of its software must be customized for its large enterprise clients, impeding customer growth
At $9.21 per share, Asana trades at 2.7x forward price-to-sales. Dive into our free research report to see why there are better opportunities than ASAN.
Donaldson (DCI)
Consensus Price Target: $96.80 (0.9% implied return)
Playing a vital role in the historic Apollo 11 mission, Donaldson (NYSE:DCI) manufacturers and sells filtration equipment for various industries.
Why Does DCI Worry Us?
- Constant currency growth was below our standards over the past two years, suggesting it might need to invest in product improvements to get back on track
- Projected sales growth of 6.9% for the next 12 months suggests sluggish demand
- Eroding returns on capital suggest its historical profit centers are aging
Donaldson is trading at $95.98 per share, or 22.5x forward P/E. Read our free research report to see why you should think twice about including DCI in your portfolio.
Enact Holdings (ACT)
Consensus Price Target: $50.20 (0.5% implied return)
Playing a critical role in helping first-time homebuyers access the housing market, Enact Holdings (NASDAQ:ACT) provides private mortgage insurance that enables lenders to offer home loans with lower down payments while protecting against borrower defaults.
Why Do We Pass on ACT?
- Insurance offerings faced market headwinds this cycle, reflected in stagnant net premiums earned over the last five years
- Sales are projected to remain flat over the next 12 months as demand decelerates from its two-year trend
- Earnings growth over the last two years fell short of the peer group average as its EPS only increased by 5.8% annually
Enact Holdings’s stock price of $49.96 implies a valuation ratio of 1.2x forward P/B. Check out our free in-depth research report to learn more about why ACT doesn’t pass our bar.
Stocks We Like More
ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively.
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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-micro-cap company Kadant (+214% between June 2020 and June 2025). Find your next big winner with StockStory today.