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In this article, we will discuss the 12 best falling stocks to buy now. If you want to explore similar stocks, you can read 5 Best Falling Stocks to Buy Now.
We are approaching the end of the year which has been terrible for the markets. Fears of recession, the Ukraine war, supply chain woes, inventory gluts, and China's Covid lockdowns among other events have hit the markets hard. The Fed has been on the most aggressive rate hike regime since the Volcker days and has raised interest rates by 375 basis points in a single year. The markets have been on a wild ride in 2022. However, now they seem to have priced in most of the factors that have been overwhelming them throughout the year. On November 25, the S&P 500 closed above 4000 points, the Dow closed above 34,000 points, and the Nasdaq composite closed above 11,000 points.
"We're Actually Headed Out Of The Woods, But We Are Not Out Of The Woods Yet"
On November 25, Oppenheimer's chief investment strategist John Stoltzfus appeared in an interview on CNBC where he discussed the current market situation and his market outlook for year-end and into 2023. Stoltzfus noted that "we see a nice rally" which is led by "materials, industrials, financials, and utilities" segments. John Stoltzfus noted that "investors are coming back" into the S&P 500, so it supports Oppenheimer's 2022 year-end target for the S&P 500, which is at least 4000 points. Here are some comments from John Stoltzfus:
"From where we stand right now, we think the equity market has fairly well priced in a recession earlier on than it's deciding there may not be a recession. The bond market looks like it's sort of caught in between, so we would have to say, with part of it looking like the short end of the curve... We think things are getting better, we're actually headed out of the woods but we are not out of the woods yet..."
John Stoltzfus also shared sectors he likes given the current market situation and where he is encouraging investors to look at. John Stoltzfus noted that investors should look into consumer discretionary and technology, and the sectors that he particularly likes include financials and industrials. John Stoltzfus said that he sees materials and energy performing well in 2023. However, he thinks that energy may have peaked and "energy will not do as well as it did this year (2022), as it is the only sector that is up 60% for the year". This article will discuss some of the best falling stocks to buy now which include General Motors Company (NYSE:GM), NVIDIA Corporation (NASDAQ:NVDA), and Meta Platforms, Inc. (NASDAQ:META).
Our Methodology
To determine the best falling stocks to buy now, we screened for profitable companies that have declined by more than 30% year to date, as of November 25. We narrowed down our selection to stocks that have the potential to gain in the long term based on company fundamentals, the industry they belong to, and their market position. We also gave weight to the market sentiment around each stock and picked stocks that had positive market sentiment. These stocks are arranged according to their popularity among elite money managers, from least to most.
Best Falling Stocks to Buy Now
12. BioNTech SE (NASDAQ:BNTX)
Year-To-Date Decline as of November 25: 33.21%
Number of Hedge Fund Holders: 18
BioNTech SE (NASDAQ:BNTX) is a German biotechnology company that is focused on the development of immunotherapies for the treatment of cancer and other diseases. The company was founded in 2008 and is headquartered in Mainz, Germany. The company's vaccines have shown promising results in clinical trials and are expected to be approved by regulatory authorities in the near future. The commercial launch of the company's vaccines will drive significant revenue growth and earnings expansion. The company's strong partnerships with leading global pharmaceutical companies such as Pfizer Inc. (NYSE:PFE) will enable it to achieve scale and reach a large number of patients globally. The company is well-positioned to capitalize on the growing demand for vaccines against infectious diseases and is ranked among the best falling stocks to buy now. The stock is down 33.21% for the year, as of November 25.
On November 10, BioNTech SE (NASDAQ:BNTX) and Pfizer Inc. (NYSE:PFE) announced that their booster dose of Omicron BA.4/BA.5-adapted bivalent COVID-19 vaccine has received marketing authorization from the European Medicines Agency Committee for Medicinal Products for children of ages 5 to 11. On November 16, BioNTech SE (NASDAQ:BNTX) and Pfizer Inc. (NYSE:PFE) announced that the two companies have commenced the Phase 1 study to evaluate the safety, tolerability, and immunogenicity of a next-generation COVID-19 vaccine candidate.
On November 8, Canaccord analyst William Maughan updated his price target on BioNTech SE (NASDAQ:BNTX) to $191 from $200 and maintained a Buy rating on the shares.
At the end of the third quarter of 2022, 18 hedge funds were long BioNTech SE (NASDAQ:BNTX) and held stakes worth $185.9 million in the company. Of those, Coatue Management was the top investor in the company and disclosed a position of $56.8 million.
Here is what Artisan Partners had to say about BioNTech SE (NASDAQ:BNTX) in its third-quarter 2022 investor letter:
“BioNTech SE (NASDAQ:BNTX) is a leading biotech company focused on developing immunotherapies to treat cancer and other serious diseases. Over the past year, we trimmed our position significantly as we believed the stock’s valuation failed to reflect the windfall nature of COVID-19 vaccine cash flows. With the stock nearly 70% off its highs and, more importantly, at a reasonable discount to our PMV estimate, we view the valuation as opportunistic given its long-term profit cycle potential. BioNTech’s intellectual property in mRNA, and COVID funded manufacturing capacity leave it well-positioned to develop new mRNA vaccines and cancer therapies. In addition, the company has non-mRNA technology (e.g., cell therapy assets) and blue-chip partnerships offering additional optionality. While the company’s R&D pipeline beyond COVID-19 vaccines will take some time to mature, it is well funded by close to $20 billion in COVID-vaccine proceeds. We increased our position within the GardenSM as the stock declined.”
Some of the best-in-class companies that are down 30% for the year but are presenting a buying opportunity include General Motors Company (NYSE:GM), NVIDIA Corporation (NASDAQ:NVDA), and Meta Platforms, Inc. (NASDAQ:META).
11. Robinhood Markets, Inc. (NASDAQ:HOOD)
Year-To-Date Decline as of November 25: 49.08%
Number of Hedge Fund Holders: 24
Robinhood Markets, Inc. (NASDAQ:HOOD) is the pioneer of commission-free trading of stocks, options, ETFs, and cryptocurrencies. Founded in 2013, Robinhood Markets, Inc. (NASDAQ:HOOD) has quickly become a popular investment platform among retail investors and has garnered a user base of over 15 million. In addition to being a popular stockbroker, Robinhood Markets, Inc. (NASDAQ:HOOD) is also a FinTech company that is constantly innovating and expanding its products and services. The company has also been expanding its cryptocurrency offering and is now one of the popular platforms for trading cryptocurrencies. Robinhood Markets, Inc. (NASDAQ:HOOD) has been able to successfully tap into the millennial market and is well-positioned for continued growth. The stock is down 49% for the year, as of November 25, and s ranked among the best falling stocks to buy now.
On November 15, Deutsche Bank analyst Brian Bedell updated his price target on Robinhood Markets, Inc. (NASDAQ:HOOD) to $9 from $11 and maintained a Hold rating on the shares.
At the end of Q3 2022, 24 hedge funds were bullish on Robinhood Markets, Inc. (NASDAQ:HOOD) and held stakes worth $740 million in the company. This is compared to 26 positions in the previous quarter with stakes worth $617.9 million. As of September 30, ARK Investment Management is the top investor in the company with stakes worth $332.3 million.
10. Kohl's Corporation (NYSE:KSS)
Year-To-Date Decline as of November 25: 35.60%
Number of Hedge Fund Holders: 31
Kohl's Corporation (NYSE:KSS) is a leading retailer of apparel, shoes, and home products, with more than 1,100 stores across the United States. The company has a strong reputation for offering quality products at great value and has a loyal customer base. Kohl's Corporation (NYSE:KSS) has a strong online presence and is expanding its footprint in the digital space. The company is investing in its store portfolio and is well-positioned for long-term growth. The stock is down 35.60% for the year, as of November 25, and is one of the best falling stocks to buy now.
Kohl's Corporation (NYSE:KSS) is currently trading at bargain levels and is presenting an attractive buying opportunity. As of November 25, the stock is trading at a PE multiple of 7x. On November 9, Deutsche Bank analyst Gabriella Carbone revised her price target on Kohl's Corporation (NYSE:KSS) to $34 from $36 and maintained a Buy rating on the shares.
At the close of Q3 2022, 31 hedge funds were long Kohl's Corporation (NYSE:KSS) and disclosed stakes of $293.3 million in the company. Of those, Arrowstreet Capital was the largest shareholder in the company and held stakes worth $90.2 million.
9. Algoma Steel Group Inc. (NASDAQ:ASTL)
Year-To-Date Decline as of November 25: 36.78%
Number of Hedge Fund Holders: 39
Algoma Steel Group Inc. (NASDAQ:ASTL) is a steel manufacturing company located in Canada. Algoma Steel Group Inc. (NASDAQ:ASTL) has a long history of profitability and growth that dates back to the 1900s. The company is vertically integrated and has a low-cost production process. The company has a strong market position in Canada and is well-positioned to grow in the future. As of November 25, Algoma Steel Group Inc. (NASDAQ:ASTL) is down 36.78% for the year and is ranked among the best falling stocks to buy now.
Wall Street is bullish on Algoma Steel Group, Inc. (NASDAQ:ASTL). On September 28, BMO Capital analyst David Gagliano updated his price target on Algoma Steel Group Inc. (NASDAQ:ASTL) to C$14 from C$16 and maintained an Outperform rating on the shares. On November 21, Stifel analyst Ian Gillies raised his price target on Algoma Steel Group Inc. (NASDAQ:ASTL) to C$10.75 from C$10.25 and reiterated a Hold rating on the shares.
At the end of the third quarter of 2022, 39 hedge funds were long Algoma Steel Group Inc. (NASDAQ:ASTL) and held stakes worth $245.4 million in the company. Of those, Contrarian Capital was the top shareholder in the company and held a position worth $48.3 million.
Here is what Nordstern Capital had to say about Algoma Steel Group Inc. (NASDAQ:ASTL) in its third-quarter 2022 investor letter:
“The world is short on raw materials and energy. Nordstern Capital has increased its exposure to raw materials and energy. Recession fears may temporarily suppress demand and prices. The fundamental issue, however, is a sustainable lack of supply, caused by decade-long underinvestment. The shortages cannot be resolved in the short to medium term.
Currently suppressed stock prices offer a wonderful opportunity for our commodity businesses to buy back their own shares. For instance, Algoma Steel Group (NASDAQ:ASTL) reduced its diluted share count this year from 177 million to 111 million. Nonetheless, ASTL’s share price has come down 50%, because US HRC steel prices per ton declined in the past year from $2,000 to currently $713. Today, ASTL has $500m in net cash and a market capitalization of about $700m. The company is profitable even in the current recessionary environment. The CFO expects annual mid-cycle free cash flow generation greater than the current ASTL enterprise value. This is one illustrative example. ASTL is not alone. Many present-day commodity businesses are cash and earnings rich and can use weak stock prices for aggressive buybacks.”
8. Ford Motor Company (NYSE:F)
Year-To-Date Decline as of November 25: 35.32%
Number of Hedge Fund Holders: 47
Ford Motor Company (NYSE:F) is among the world's leading automakers, with a strong presence in Europe, North America, and Asia. The company's product lineup is diverse and includes some of the most popular vehicles in the world, such as the Ford Mustang and the F-150 pickup truck. The company has a strong history of innovation and is currently investing heavily in new technologies such as electric vehicles and autonomous driving. The company's financials are solid, with strong profitability and a healthy balance sheet. Ford Motor Company (NYSE:F) has free cash flows of $16.48 billion and an ROE of 22.49%.
On October 27, Morgan Stanley analyst Adam Jonas maintained an Overweight rating and his $14 price target on Ford Motor Company (NYSE:F). As of November 25, Ford Motor Company (NYSE:F) is trading at a PE multiple of 6x and is down 35% for the year. The stock is one of the best falling stocks to buy now.
At the end of the third quarter of 2022, 47 hedge funds were bullish on Ford Motor Company (NYSE:F) and held stakes worth $1.18 billion in the company. This is compared to 46 positions in the preceding quarter with stakes worth $608.7 million. The hedge fund sentiment for the stock is positive. As of September 30, Fisher Asset Management is the largest shareholder in Ford Motor Company (NYSE:F) and has stakes worth $503.6 million.
7. Target Corporation (NYSE:TGT)
Year-To-Date Decline as of November 25: 29.56%
Number of Hedge Fund Holders: 52
Target Corporation (NYSE:TGT) is a well-known retailer with a reputation for offering quality products at reasonable prices. The company has a strong brand and a loyal customer base. Target Corporation (NYSE:TGT) has a strong online presence and is able to compete with other online retailers. Target Corporation (NYSE:TGT) is a well-managed company with a commitment to its shareholders. As of November 25, the stock is offering a forward dividend yield of 2.64% and is down roughly 30% for the year. Target Corporation (NYSE:TGT) is ranked among the best falling stocks to buy now.
On November 17, DA Davidson analyst Michael Baker adjusted his price target on Target Corporation (NYSE:TGT) to $180 from $185 and maintained a Buy rating on the shares. This November, Baird analyst Peter Benedict revised his price target on Target Corporation (NYSE:TGT) to $180 from $190 and reiterated an Outperform rating on the shares.
At the end of Q3 2022, 52 hedge funds held stakes in Target Corporation (NYSE:TGT) that amounted to $2.03 billion. This is compared to 46 positions in the preceding quarter with stakes worth $1.27 billion. The hedge fund sentiment for the stock is positive. As of September 30, Fisher Asset Management is the top investor in Target Corporation (NYSE:TGT) and has a position worth $711.3 million.
Here is what Carillon Tower Advisers had to say about Target Corporation (NYSE:TGT) in its second-quarter 2022 investor letter:
“Target Corporation (NYSE:TGT) faced its worst day in decades after trimming its profit forecast for the year due to higher costs. While many of the cost pressures are likely to persist in the near term, the company also struggled with a shift in consumer spending, which resulted in inventory write-downs.”
In addition to Target Corporation (NYSE:TGT), investors that have the patience to wait for long-term gains can also explore General Motors Company (NYSE:GM), NVIDIA Corporation (NASDAQ:NVDA), and Meta Platforms, Inc. (NASDAQ:META).
6. Intel Corporation (NASDAQ:INTC)
Year-To-Date Decline as of November 25: 44.86%
Number of Hedge Fund Holders: 69
Intel Corporation (NASDAQ:INTC) is among the world's leaders in silicon innovation and the largest chipmakers. The company's products are the building blocks of the computing and communications revolution that has transformed the way we live, work and play. The stock has gotten hammered in 2022 and is down about 45% for the year, as of November 25, but with the company's history of continuous innovation, Intel Corporation (NASDAQ:INTC) has the potential to bounce back. The stock is ranked among the best falling stocks to buy now and is presenting an attractive buying opportunity for investors. As of November 25, the stock is trading at a PE multiple of 9x and is offering a forward dividend yield of 4.98%.
On November 21, Cowen analyst Matthew Ramsay resumed coverage of Intel Corporation (NASDAQ:INTC) with a Market Perform rating and a $31 price target. This November, Mizuho analyst Vijay Rakesh reinstated coverage of Intel Corporation (NASDAQ:INTC) with a Neutral rating and a $32 price target.
At the end of Q3 2022, 69 hedge funds were bullish on Intel Corporation (NASDAQ:INTC) and disclosed stakes of $1.91 billion. As of September 30, Two Sigma Advisors is the largest shareholder in Intel Corporation (NASDAQ:INTC) and has stakes worth $390.4 million in the company.
Here is what ClearBridge Investments had to say about Intel Corporation (NASDAQ:INTC) in its third-quarter 2022 investor letter:
“Also on the detractor side, Intel Corporation (NASDAQ:INTC) delivered a disappointing revenue miss and lowered full-year revenue and earnings guidance as COVID-19-driven demand for PCs abated (where Intel enjoys half its sales) and a delay in its flagship Sapphire Rapids CPU hurt its data center business. Despite these issues, we still believe Intel is an economically sensitive turnaround story with substantial upside.”
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Disclosure: None. 12 Best Falling Stocks to Buy Now is originally published on Insider Monkey.
