Amid the high-flying tech darlings, there are “fallen angels,” once-loved robust companies facing temporary challenges. The month of February mirrors the stock market’s volatility. However, for some beaten-down stocks, this period can serve as fertile ground for potential growth.
Deere (DE)
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A leader in the agricultural machinery sector for 180 years, Deere (DE) has recently seen its share price dip due to the cyclical nature of its end markets, reduced demand, and a revised guidance. Despite posting better-than-expected Q1 2024 results, Deere saw a decrease in net income by 11% and diluted earnings down 5% to $6.23 per share. However, investors shouldn’t dismiss Deere’s potential entirely. The company’s strategic investments and diversified operations position it well to navigate market fluctuations. Long-term investors would be interested to know that DE stock has lost just over 10% year-to-date (YTD) with a 15% upside potential.
NextEra Energy (NEE)
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NextEra Energy (NEE) is a notable player in the renewable energy sector. Despite challenges in its renewable energy segment due to regulatory scrutiny, NextEra maintains steady earnings growth and stable dividend payments. The utility group benefits from its regulated distribution network and investments in renewables. NEE stock has declined almost 8% YTD with a potential 25% upside from current levels.
Starbucks (SBUX)
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Investors seeking beaten-down stocks may also consider coffee giant Starbucks (SBUX) as another option. The company has faced valuation concerns due to fierce competition as well as macroeconomic uncertainty, especially in China. Yet, Starbucks’ proactive measures to counter these challenges, including promotional efforts, price adjustments, and product innovation, present an interesting opportunity. Starbucks stock has dropped nearly 1% YTD with a 13% upside potential.
On the date of publication, Tezcan Gecgil 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.
