While it’s usually a solid principle to bet alongside Wall Street’s top experts, sometimes, they don’t get it right, which brings us to contrarian analyst picks. You know how I’ve been supporting my arguments with analyst ratings and price targets? Well, this time, we’re going to dive into the opposite realm; that is, trading against the experts.

Based on the data, contrarian analyst picks might make sense. According to a CNBC report in September 2020, individual stock picking suffers a terrible track record. Basically, actively managed funds have been found to fare worse than funds that were passively managed. That doesn’t speak highly of the mutual funds that feature high expenses; I mean, what are you paying for?

More recently in late December, The Globe and Mail published an op-ed that argued that stock market predictions are awful. So, it goes without saying that sometimes, you can find gold in the experts’ sell ratings. Below are risky but possibly rewarding contrarian analyst picks.

Harmony Gold Mining (HMY)

Frankly, you had me at “gold.” At this juncture, everyone should be extremely careful about betting against precious metals or sector-related enterprises. That goes for Harmony Gold Mining (NYSE:HMY). Based in resource-rich South Africa, Harmony features multiple underground mines along with one open-pit mine and several surface operations in its home market. And to be sure, it’s understandable why some folks are skeptical about HMY.

Shares gained over 78% of equity value. That’s well above the performance of the sector benchmark SPDR Gold Trust (NYSEARCA:GLD), which gained a bit over 5% during the same period. So, if I had to guess, I’d say that market participants anticipate a rotation out of the metals and toward another asset class. Subsequently, JPMorgan Chase analyst Catherine Cunningham rated HMY a “sell” with a $3.20 price target, implying severe volatility.

Respectfully, I must disagree. With a strong jobs report and a strong economy to boot, I see more dollars chasing after fewer goods. Fundamentally, I’m hesitant to bet against HMY when the backdrop is so favorable. It’s easily one of the contrarian analyst picks.

Antero Midstream (AM)

Headquartered in Denver, Colorado, Antero Midstream (NYSE:AM) operates and develops midstream gathering, compression, processing, and fractionation assets in the heart of the Appalachian Basin. Per its website, Antero represents the critical first link to the global export market for liquified natural gas (LNG) and liquified petroleum gases (LPG). As with the negativity surrounding Harmony Gold Mining, I don’t understand the pessimism over Antero.

Okay, it doesn’t offer the greatest financial print. Further, weaknesses in global demand has negatively impacted the LNG price in particular. However, this could be short-term thinking. Should economic conditions improve in other parts of the world besides the U.S., consumption trends will increase. Also, central banks could pivot from a hawkish policy to a dovish one, presenting a tailwind for the natural gas ecosystem.

Currently, analysts peg AM shares as a moderate sell with an average price target of $14. The price target seems reasonable but the sell rating does not. If anything, the bears should watch out because their short-call positions could get toasty if AM meets the $14 target ahead of schedule. I consider AM one of the contrarian analyst picks.

Dillard’s (DDS)

On the surface, I can appreciate why some experts don’t like Dillard’s (NYSE:DDS). As a department store chain focused on luxury goods, it suffers from two immediate headwinds. Number one, Dillard’s and its ilk come under constant pressure from e-commerce rivals. Number two, the retail giant may be hurting from the residual impact of multiple consumer pressures. After long bouts of inflation and high interest rates, the consumer is crying uncle.

I’m not just saying that. If you look at the personal saving rate, you’ll notice a spike in savings during the early months of 2023. That’s not a shocker given the Federal Reserve’s battle against inflation via the raising of interest rates. Basically, the hawkish policy made cash worth more over time, not less as is usually the case. With that in mind, people naturally saved their dollars, which doesn’t do well for DDS.

However, the Fed has recently pointed to broadly encouraging disinflationary data. So, with the central bank hinting at lower interest rates, DDS could be one of the contrarian analyst picks. Plus, betting against DDS amid elevated short interest trends may bode poorly for the bearish speculator.

Consolidated Edison (ED)

Based in New York, Consolidated Edison (NYSE:ED) – commonly known as Con Edison or ConEd – represents one of the largest investor-owned energy companies in the U.S. Per its public profile, the company provides a wide range of energy-related products and services to its customers via its subsidiaries. For me, the reality is that it’s difficult to bet against an energy and utility giant unless we’re talking about an Enron-type situation.

Sure, Consolidated Edison doesn’t have the greatest financial print – I won’t argue that point. However, it is consistently profitable because of its natural monopoly. Also, the company pays a forward dividend yield of 3.66%. Admittedly, it’s a bit underwhelming compared to the sector’s average yield of 3.75%. But here’s the thing: the company enjoys 51 years of consecutive annual payout increases. It’s a dividend king, in other words.

At the very least, ED stock deserves a hold rating. Instead, analysts rate it a moderate sell with an $88.75 price target, implying modest downside risk. Still, I think it’s one of the contrarian analyst picks based on its permanent relevance.

Aveanna Healthcare (AVAH)

Just by looking at the expert assessment of Aveanna Healthcare (NASDAQ:AVAH), you might be tempted to abandon ship. Analysts rate shares a consensus moderate sell with zero buys, two holds and two sells. Further, the average price target sits at $2.25, implying significant downside risk. Still, part of the reason why the experts may be skittish could center on its strong market performance.

In the past 52 weeks, AVAH has more than doubled in value. Because it’s a small-capitalization play, analysts may be anticipating a rotation out of the enterprise. Stated differently, the low-hanging fruit has already been plucked. And now, it’s time to move onto something else.

However, such a framework ignores the viability of the underlying home healthcare service. According to Grand View Research, the domestic home healthcare market reached a valuation of $142.9 billion in 2022. Further, it could expand at a compound annual growth rate (CAGR) of 7.48% to 2030. At the forecast culmination, the segment could be worth $253.4 billion.

Relatively speaking, then, Aveanna enjoys a massive total addressable market. I’d say this is one of the contrarian analyst picks.

Tellurian (TELL)

Headquartered in Houston, Texas, Tellurian (NYSEAMERICAN:TELL) is a natural gas company. At first blush, it’s easy to see why TELL doesn’t attract much analyst attention (or respect). Falling into literal penny stock territory, Tellurian basically flirts with a de-listing from its underlying exchange. To get back into the exchange operators’ good graces, it would need to raise its share price.

Such an action would likely involve a reverse split, which represents its own bag of worms. Basically, astute investors recognize the cynicism undergirding the action. Nevertheless, I don’t like the idea of betting alongside the shorts, not when so many are bearish.

First, TELL prints a short interest of 15.3% of its float, which is getting up there. Basically, traders are borrowing TELL stock to directly short the company. Second, major traders – as determined by Fintel’s options flow screener – are betting against TELL with multiple short call positions.

So, what we have are bearish traders taking shots against TELL in both the open and derivatives markets. If shares rise higher for whatever reason, you could potentially see both a short squeeze and a gamma squeeze. That’s too rich for my blood.

Emergent Biosolutions (EBS)

A multinational specialty biopharmaceutical company, Emergent Biosolutions (NYSE:EBS) develops vaccines and antibody therapeutics for infectious diseases and opioid overdoses. Further, it provides medical devices for biodefense purposes. Seemingly relevant, the corporate profile alone might have you jump aboard the opportunity. Then you look at its 52-week chart and breathe a sigh of relief that you didn’t make the leap of faith.

Because of the steep loss, I’m not here to say that Emergent is a sterling opportunity. It’s not. However, I do think it’s one of the contrarian analyst picks because I wouldn’t bet against it. Nevertheless, analysts presently regard EBS as a consensus moderate sell (though the $5 price target belies bearish intent).

Here’s the deal. Per Fintel, EBS carries a high short interest of 23% of its float. As well, its short interest ratio stands at 14.65 days to cover. What that means is that it would take almost 15 trading days for the bears to unwind their short positions. During that time, the pessimists could suffer a lot of damage. Basically, it’s not worth taking the negative wager.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.