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.

At StockStory, we look beyond the headlines with our independent analysis to determine whether these bearish calls are justified. That said, here are three stocks where Wall Street’s pessimism is creating a buying opportunity.

TransDigm (TDG)

Consensus Price Target: $1,567 (3.1% implied return)

Supplying parts for nearly all aircraft currently in service, TransDigm (NYSE: TDG) develops and manufactures components and systems for military and commercial aviation.

Why Will TDG Outperform?

1. Core business can prosper without any help from acquisitions as its organic revenue growth averaged 14.8% over the past two years
2. Additional sales over the last two years increased its profitability as the 30.8% annual growth in its earnings per share outpaced its revenue
3. TDG is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders, and its growing cash flow gives it even more resources to deploy

TransDigm is trading at $1,520 per share, or 37.9x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.

Preferred Bank (PFBC)

Consensus Price Target: $93 (7.5% implied return)

Founded in 1991 with a focus on serving the Pacific Rim community in Southern California, Preferred Bank (NASDAQ: PFBC) is a commercial bank that provides banking products and services to small and mid-sized businesses, entrepreneurs, real estate developers, and high net worth individuals.

Why Could PFBC Be a Winner?

1. 10.7% annual net interest income growth over the last four years surpassed the sector average as its products resonated with borrowers
2. Share buybacks catapulted its annual earnings per share growth to 13.3%, which outperformed its revenue gains over the last five years
3. Balance sheet strength has increased this cycle as its 13.2% annual tangible book value per share growth over the last five years was exceptional

At $86.55 per share, Preferred Bank trades at 1.3x forward P/B. Is now the right time to buy? Find out in our full research report, it’s free.

Frost Bank (CFR)

Consensus Price Target: $129.67 (0.9% implied return)

Tracing its roots back to 1868 when it was founded during Texas's post-Civil War reconstruction era, Cullen/Frost Bankers (NYSE: CFR) operates Frost Bank, a Texas-based financial institution providing commercial and consumer banking, wealth management, and insurance services.

Why Is CFR Interesting?

1. Impressive 13.8% annual net interest income growth over the last four years indicates it’s winning market share this cycle
2. Net interest margin expanded by 55.3 basis points (100 basis points = 1 percentage point) over the last two years, providing additional flexibility for investments
3. Annual tangible book value per share growth of 22.1% over the past two years was outstanding, reflecting strong capital accumulation this cycle

Frost Bank’s stock price of $128.54 implies a valuation ratio of 1.9x forward P/B. Is now a good time to buy? See for yourself in our full research report, it’s free.

High-Quality Stocks for All Market Conditions

Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.

While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today