The 4 stocks that analysts hate

Analysts are typically bullish on the companies they cover. But four stocks have the experts suggesting a sprint to the hills.

These are the stocks that are trading substantially above analysts' median target price. That is, if these stocks fall to their analysts' target prices, they will drop 30 percent or more.

The biggest such gulf is seen for oil and natural gas name Denbury Resources. As energy prices have bounced back, the company's shares have risen more than 20 percent in the past week, hitting $3.90 on Wednesday. Meanwhile, the 16 analysts who cover the stock have a median target of $1.80, according to FactSet.

One analyst who's a Denbury bear even among his peers is Stifel's Michael Scialla, who has a sell rating and $1 target on the name.

"Right now I'm cautious, but we've been too cautious," he granted in a Wednesday phone interview.

Still, he explains that Denbury is a highly leveraged stock with a great deal of debt, which means that its balance sheet "could get it into trouble if oil prices stay at $40 or lower."

On the upside, "if oil gets back to $50, they're an oil recovery play that starts to work," he said. "Denbury's way out there on the risk spectrum, but when things are working out, it's going to go up a lot more – and that's what's been happening."

Since Denbury essentially acts like an option on oil prices, Scialla and his peers are forced into the unfortunate situation of having to forecast oil prices in order to call the stock's next move.

The situation is not too dissimilar for the other stocks on this list.

Median Price Target
Implied Move
Denbury Resources 1.8 -51%
United States Steel 11.0 -45%
AK Steel 3.3 -37%
Chesapeake Energy 4.3 -31%

Chesapeake is another highly leveraged energy play — so highly leveraged, in fact, that the company has recently felt compelled to release a statement in order to quash bankruptcy rumors, rarely a good thing.

The two steel companies, meanwhile, have managed sizable bounces thanks to some positive news in the steel patch.

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All in all, "it's a sorry bunch," Eddy Elfenbein of Crossing Wall Street commented Tuesday on CNBC's "Trading Nation." "I can see why the analyst community is so negative on them right now."

The dour views on these stocks contrast the overall bullish tenor of Wall Street analysis. Among all the stocks in the S&P 1500 with market values above $500 million, the median analyst price target implies the expectation of an 8 percent rally.


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Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's “Closing Bell (M-F, 3PM-5PM ET).   In addition, he contributes to CNBCand CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

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