7 Beaten-Down Stocks Ready to Mount a Comeback in 2025

If you only looked at NVIDIA Corp. (NASDAQ: NVDA), you would think it’s been a great year for semiconductor stocks (i.e. chip stocks). But if you look at one of the largest sector exchange-traded funds, the iShares Semiconductor ETF (NASDAQ: SOXX), you get a different story. The SOXX fund has underperformed the market in 2024 with a gain of approximately 11%.  

And a stock like Advanced Micro Devices Inc. (NASDAQ: AMD) has been even more of a laggard. AMD stock is down more than 11% in 2024 as of December 12.

However, analysts are projecting a recovery in chip stocks in 2025. Demand for the chips that power artificial intelligence (AI) applications will continue, and several companies are looking at AMD as an alternative to NVIDIA’s solutions.  

Analysts are forecasting a strong recovery for AMD stock, with a consensus price target of $192.36. This gives the stock a 48% upside, about 17% higher than if the company hits the midpoint of its fourth-quarter guidance at its current valuation.  

Micron Technology Inc. (NASDAQ: MU) is up about 19.5% in 2024. That’s a solid return, but if you’re an investor, your feelings about MU stock will depend on your entry point. The stock is down approximately 35% from its 52-week high.  

Analysts forecast a consensus price target of $143.04, which is a 45% gain from the MU stock price on December 12. To support that price point at the stock’s current valuation of approximately 12x forward earnings, analysts believe the company’s FY2025 earnings per share (EPS) will be well above the company’s guidance of $4.89 per share.  

The bullish case for Micron comes from the anticipated demand for AI applications. Micron’s high-bandwidth memory (HBM) chips are a key component of NVIDIA’s H200 and Blackwell chips. That speaks well to future demand.  

However, Micron has short-term concerns that are focused on the incoming administration's tariff policies and what they could mean for the company’s business in China, which is already affected by more competition.  

One more pick in the chip sector is Lam Research Corp. (NASDAQ: LRCX). The company designs, manufactures, and services semiconductor fabrication equipment. LRCX stock is down about 3% in 2024, but the stock is down over 33% from its all-time high in July 2024.  

Investors are concerned about a possible crackdown on the company, which generates approximately 37% of its revenue from China. However, Lam Research is likely to offset at least some of its lost revenue from a recovery in the NAND flash memory market. Growth in this core market will also allow the company to expand its operating and gross margins, both of which have been declining with a slowdown in the NAND market.  

Analysts give LRCX stock a consensus price target of $97.24, which would be a 28% gain from its price on December 12, 2024. That would correspond to the expected earnings growth of 14.5%.  

Moving outside the chip sector, the first company you may want to consider is United Parcel Service Inc. (NYSE: UPS). The stock is down 17.8% in 2024, but the story with UPS is straightforward. The company’s revenue and, more significantly, its earnings have been under pressure as higher interest rates have softened demand for package delivery.  

However, the company reported a 12% year-over-year (YoY) earnings beat in its third quarter 2024. Investors will want to see that trend continue and hear what the company believes about future demand and when they may expect margins to recover. 

That said, your investment decision on UPS stock will come down to your feelings on interest rates. If the Federal Reserve decides to slow down its rate cut campaign, the upside in UPS stock may be limited. However, even in that scenario, as long as rates don’t move higher, the company’s dividend which has a juicy 5.07% yield looks safe.  

Toyota Motor Corp. (NYSE: TM) may seem like a contrarian pick for 2025, but when you look under the hood (pun intended), there’s a growth story in the making. Specifically, at a time when the lack of an electric vehicle (EV) infrastructure is suppressing demand, consumers want alternatives. 

In the last few years, Toyota has stood its ground in its belief that hybrid vehicles were a way for consumers to thread the needle between environmental concerns over internal combustion engine (ICE) vehicles and impractical (for now) EVs. That belief is paying off as consumers are flocking to hybrids. In its most recent quarter, Toyota reported a 122.2% increase in the number of hybrid electric vehicles (HEVs) sold.  

That hasn’t paid off yet for shareholders. TM stock is down 3% in 2024, but it’s down more than 30% from its 52-week high set earlier in the year. Investors are rightly concerned about the potential impact on the company’s revenue due to tariffs. But at a time when consumers will continue to look for new vehicles, Toyota may be a value hiding in plain sight.  

If you have a high risk tolerance, Nucor Corp. (NYSE: NUE) is a comeback stock to consider. The steelmaker will be one of the companies front and center in the upcoming tariff debate.  

A range of possibilities exist. The most bearish for NUE stock in the short term is that a tariff war will reignite inflation and cause a slowdown in demand, particularly in construction. The bullish thesis stems from the company’s recent investments in manufacturing capacity, production efficiency, and its position in new revenue streams.  

The reality will likely be somewhere in between. In which case, investors should be looking favorably at a stock that’s down 23% in 2024 and is trading around its 52-week low.  

NUE stock has a consensus price target of $183.75, which offers a 39% upside. To put that into context, Nucor received a downgrade from UBS Group on December 12 due to demand concerns. However, their adjusted price target of $156 would still be a gain of about 20%.  

It’s been a good year for biopharmaceutical companies that offer GLP-1 drugs. That’s left companies like Merck & Co. (NYSE: MRK) on the wrong side of the biopharma trade. The stock is down about 7.6% in 2024.  

The concern is not about the company’s current performance—it continues to post YoY gains on the top and bottom lines. But investors are concerned about the patent cliff for the company’s blockbuster drug Keytruda, which will occur in 2028. Keytruda currently accounts for about 50% of the company’s revenue, and while the company has a deep pipeline, there’s no immediate replacement for Keytruda. 

Nevertheless, some analysts believe that the company’s revenue recovery may be good enough. The consensus price target of $129.20 gives the stock a 28.4% upside, and investors also get a dividend with an attractive 3.08% yield. 

Analysis paralysis is one of the biggest impediments for investors to overcome. It's one thing to decide that you have to make changes to your portfolio. But it can be difficult to decide what those changes should be, particularly when you're considering your investment goals and risk tolerance. 

You can put your money into ETFs. But if you're reading this presentation, we suspect you have the time and the interest in picking your own stocks.  

MarketBeat has several tools to help simplify the process of finding investment ideas. To find the stocks in this presentation, we used the MarketBeat Stock Screener and adjusted the filters to find stocks trading within 30% of their 52-week lows but with at least 10% earnings upside for 2024.  

And that's just one free tool available to investors. MarketBeat All-Access members can take advantage of the MarketBeat Idea Engine, which uses over two dozen algorithmic factors and technical indicators to identify stocks signaling near-term growth.