10 Stocks Near 52-Week Lows — I’d Buy This One

Something very strange is happening in the stock market right now. The major indexes are back around record highs and Wall Street is becoming incredibly bullish. In fact, JP Morgan has just raised its year-end S&P 500 target from 7,800 to 8,000, citing strong earnings and easing concerns around the enormous amount of money being spent on AI. And the chase back into parts of this market has been incredibly aggressive. technology just experienced a 5-day move of more than 11%. And then when you take a look at the market on a year-to- date perspective, on the surface, things actually look pretty healthy. Nvidia's green, Amazon's green, Google's green, and huge part of the markets are working. But if we change just one thing, measure stocks from their individual highs instead, and suddenly the exact same market, it looks completely different. We've got Oracle that's down more than 50% below its high. We've got Netflix down over 40% and Tesla's down more than 30. And there's red scattered everywhere. And before we go hunting through those individual stocks, let's listen to what Tom Lee thinks happens next because his view it perfectly explains the other side of the market. It's good to have you. I'll start with you first. You say we could go 7,900 to 8,000 this month alone. So this momentum is going to continue. >> Yeah. I think uh the a the deleveraging that happened a couple of weeks ago put a lot of cash on the sidelines got sentiment quite bearish and then on top of people getting very skeptical of the Fed got markets to derisk and now I think as earnings have been good and I think there's a rethink of how inflation might be cooler than expected and of course AI is still strong there's going to be a chase. I think that chase takes us towards 7900 8,000. There's going to be a chase and in fact parts of the market that chase is already happening. But while that happens, we've got companies that have been absolutely battered. Take Apploving for example. It's down almost 50% year to date. Half of their market cap just wiped out in a matter of months. You've got another example in the trade desk that's down 64%. Rollings, well that's down more than 37%. and the retail favorite so far. Well, that's lost almost 30%. So, instead of blindly chasing the stocks already making new highs, I went looking through companies sitting at near or towards the lower end of their 52- week range, and I've narrowed that list to 10. Some I still wouldn't touch. Several have become genuinely attractive, and one in particular now has a growth and valuation combination I think is very difficult to ignore. But let's kick things off with one of the most dramatic collapses, and that's Apploving trading at $347, barely above its 52- week low, sitting at 332. And the stock, as we said, that's been battered down 49% year to date. And the chart, well, it's exactly why people are suddenly paying attention again. The stock has effectively been cut in half from where investors were willing to buy this. We're talking just a few weeks, months ago. And Wall Street, well, they give this a strong buy, four and a half out of five. On top of that, they're very bullish about the next 12 months after digesting their earnings report. Well, they see 62% over the next year, $561 price target. Although, bear in mind the range very wide, 360 bottom end, $860 at the upper end. But the first thing I want to separate is the stock from the business because those two things have moved in completely different directions. Trading revenue growth well it's up 60% forward revenue growth expected to climb more than 30% and forward Ebit dollar growth sitting there around 48% forecasted while forward diluted EPS in the 66% region and you know what if you look beyond the immediate year consensus they're forecasting earnings per share to compound 33% over the next 3 to 5 years and now let's compare that with what investors are being asked to pay Today the stock is sitting around 22 times estimated 2026 gap earnings and based on the figures we can see it falls down to 17 on 2713 on 2028 numbers and the non-GAAP numbers look cheaper again roughly sitting at 19 1/.5 times Ford earnings versus a 5-year for app that sits above 30. So relative to their own history, this is a dramatically different valuation. But I don't want to pretend that every metric here suddenly screams cheap. For example, if we take a look at forward EV to sales, it's still sitting above 14 times price to sales. Well, you can see also very expensive, sitting above 14. So if Apploven's margins or growth, if they disappoint materially, they're still for the company valuation risk. The reason though I'm more interested here is that the earnings and cash flow growth, well, they're currently doing a lot more work than they were when investors were paying a much higher price. We can see here free cash flow expected to grow 53% over the next 12 months just on a year-on-year basis. It was up 71%. And my lowase DCF that assumes just 5% future free cash flow growth and produces a value of around $371. If we bump that to the middle rate, 10% value becomes 508 and at the upper end 15%. The figure rises to 692, which is pretty much a double from today's price. My central value though, $58 compared where the price sits today. Well, we're looking at a 32% margin of safety. And as we highlighted already, Wall Street very bullish, approximately 62% upside. But perhaps the number that I find most interesting out of all of this is the reverse DCF. At today's valuation, the implied growth rate for AppLoving is around 3.8%. Now, that doesn't mean Apploving only needs to grow 3.8% next year. A DCF is much more sensitive than that and these businesses don't grow in a perfectly straight line, but it does reinforce the broader point. The expectations embedded in this stock have fallen dramatically. So for me, AP has moved from a business where the valuation required almost every single thing to go right to now a stock where the business could slow considerably from today's extraordinary growth rates and still potentially justify a much higher valuation than before. App therefore is absolutely one of the strongest candidates in the entire episode today. Now, before we dive into the next stock, which actually couldn't be more different, no explosive AI story, no 60% revenue growth, just one of the more recognizable consumer brands in America, finally trading at a much more normal valuation, I want to highlight that I've just released my latest weekly article. Now, in this particular one, if you want to see the actual numbers behind the three different scenarios for Meta, where you can click below, sign up, and read this one straight away. I'm also pointing out the stock that I'm putting fresh money into. And as always, we release one weekly basis covering severely undervalued stocks as well as what's gone in the market. So you can click below, sign up and read straight away. Now the next stock is Hershey, which trades at $182. We can see 52- week low sits around 161. Pretty much flat year to date. Zoom out to the last year though it is down around 3% where we get a fairly rare triple buy rating. Although I should point out each one is incredibly weak. three and a half the minimum needed to flip from a hole to a buy. Where this one image captures almost the entire ball case, the yield for Hershey sits at 3.2% compared with a 5year average of 2.6 and the forward P sits around 20 times versus a 5year of 25.4. And you'll also notice when we look at the blue tunnel from Simply Save Dividends, which in fact tells us the intrinsic fair price, it sits below the bottom end indicating a potential undervaluation signal. Zooming out the last 5 10 years. Few things to note. Firstly, we can see this one peaked in 2024. Since then, it has in fact come down significantly. Although we are seeing a turnaround play. Question is whether this continues and actually it's one that trades at an undervalued level in a reasonable signal and at a premium. So, investors have been happy to continue buying the company. Now, as we said, Wall Street did give it a buy rating, but it was very weak where they only see around 13% upside over the next year. $27 price target range 170 to 250 and the reason why we have got a valuation reset for the company is not difficult to find forward revenue growth that's only at 4% ebit growth only sitting at 3 1/2% and near-term diluted earnings per share while sitting below two now consensus it does expect strong 3 to 5year EPS growth around 19% but with the near-term numbers this soft I personally wouldn't blindly underwrite these figures and my DCF using 6% growth. Well, we can see it gives Hershey a value of around $192. When we take a look at all three models, well, in fact, the multiple sits at 196. Dividend discount coming in at 203. And blending all three together, we get $197. So, there is a bit of a margin of safety. We're talking around 8%, but not a massive one. So therefore overall for me Hershey is becoming slightly attractive again especially for investors who prioritize durability and income. But the next stock let's take a look is undergone a much more dramatic valuation reset while still producing doubledigit growth. And that's Netflix trading $74 down 21% year to date sitting above 52- week low of $65 but definitely in the low end of that region with actually a respectable buy rating from Wall Street at 4.3. and Wall Street themselves see 27% upside $94 price target range 70 to 135 where the most interesting part isn't actually that the stock is down is what investors are now paying for earnings. We can see it trades around 20.7 forward earnings compared with the 5-year sits higher at 36 where in fact that's looking around a 42% discount price to earnings growth at 1, which is both a discount to the sector as well as their historical figures in the 20% region. And based on current consensus numbers, well, the multiple does fall to 19 on 27, 16 on 28, and 14 on 2029. But importantly, Netflix hadn't suddenly become a no growth business. Forward revenue estimated 13.5%. EBIT dollar growth around 22. Likewise, when we look at their EBIT and diluted EPS expected to climb in the 24% region, longerterm EPS sitting at 20 and free cash flow even also looking very strong close to 27. Now, it matters because Netflix cash flow story is very different from the company investors own several years ago. My low case using 5% growth that gets to only $63. So, this absolutely scenario where today's price isn't a bargain. But at 10% we can see valuation rises to 87 at 15 118. Now the central intrinsic value gives around a 15% margin of safety and the reverse ECF comes to around 7 12%. So this is where Netflix becomes genuinely interesting to me. If you believe the company can produce something close to that 20% longerterm EPS growth estimate, then effectively paying around 20 times earnings is nothing like paying the 35 to 40 times that investors have become accustomed to. So, I wouldn't call Netflix dirt cheap, but I would say that Netflix finally being valued much more like a normal business than an untouchable premium growth asset. And if 20 times earnings sounds attractive, this company shows while the size of a share price decline on its own tells you almost nothing. That's Rollins down in fact 37% year to date. We can see pretty much trading at 52- week lows. And you'll also notice a very rare strong sell rating from Quant, a hold from Wall Street with a very weak buy from Seek Alpha. And yes, the valuations compress dramatically. The forward P is now around 31 times, the lowest in at least the last 5 years compared with the 5-year at 46. The yield also up to near 2% versus the 5-year of 1.25. We'll also note the undervaluation signal. There is disparity between the stock price today bottom end of the blue tunnel. But this is still basically a high singledigit to low double-digit growth business. Forward revenue 9 1.5% Abit DAR around 8.8 8 earnings per share well expected just shy of 10% and consensus 3 to 5 year sitting around 8. Now, Wall Street, they're predicting around 21% upside over the next year. $46 price target. Ranges are very wide. In fact, the lower end of 32. You can see more bullish sit pretty much around double that figure at 66. And my low case on the DCF at 5% comes to $29, 10% at 42, the more optimistic coming to 61. So, Rollins, it might be far more attractive than it was at $60. But when we take a look after the drop, it's not a massive amount of margin of safety. We're talking around 11% and then around 31 times earnings for a high singledigit long-term growth. Still isn't obviously cheap. And that takes us to the midpoint anchor because this stock has almost got the opposite problem. Oracle, it trades around $147, down around 25% year to date over last year, down 41%. And this one, as we can see, near 52-E lows. You'll also note actually a very near strong buy rating would have to be 4 and a half to flip that. And the forward P well it sits around 18 times slightly below the company's 5year of 20. Well, when we take a look at the blue tunnel, it's sitting right there towards the bottom end. Potential undervaluation signal. And then you look at the growth expectations. Forward revenue just shy of 32%, forward EID around 36, forward EBIT growth 25%. where the 3 to 5 year EPS estimate comes in just below 29%. So if I simply told you this was an 18 times earning stock growing revenue above 30%, you'd probably assume it's one of the easiest buys in the entire episode. But earnings, they're not the numbers that worry me. It's the cash flow. We can see here in fact estimated from analyst the projections over the next few years before it normalizes using the growth rates that were used. Essentially, it's telling us today's Oracle thesis requires you to accept enormous near-term cash investment in exchange for the possibility that the current AI infrastructure spending ultimately produces much greater revenue, much greater earnings as well as cash flow later. And you can see that directly in my valuation, if we use just 5% growth, we get $121 at 10% 160. At the more optimistic, 15% $28. So using that midpoint, we do get a margin of safety. Not massive, sitting around 8%. Where analysts are forecasting around 68% upside somewhere between $110 to $400 with the average at 247. Now the difference here is important. The bull case says today's extraordinary infrastructure investment creates years of outsized cloud and AI growth. The bare case while it's saying investors are underestimating how much cash must be consumed before these returns appear. So Oracle is absolutely one of the more fascinating opportunities here. But at the moment, I'm more comfortable calling it interesting than calling it obviously cheap. And this stock has no problem generating excitement. But even after a major decline, I'm still struggling with what investors are being asked to pay. And it's Figma. Now, we can see it's down 38% year to date. It's trading right there towards 52- week lows. Upper end extremely high in comparison, $91 with a double week buy from both SE Alpha as well as Wall Street. and Wall Street are actually forecasting around 31% upside just under $31. But when we take a look at their valuation where the grading actually sits at a D minus while forward non-GAAP P sits around 80 times forward EV to sales well that sits at 7.4 and forward EV to Ebitar well that's sitting very high above 70. Now the business itself is growing quickly. Revenue is up 43% year-over-year. We can see lever free cash flow that was up 193% and the 3 to 5 year EPS that's expected to climb 17% annually where my central DCF assumes 15% free cash flow growth and gets around $24. At 10% it falls to 18% and even at 20% I get around 33 where the reverse DCF is estimating around 14.3% future growth to justify today's price. So at around $24 when we take a look there's only around a 4% margin of safety. So Figma is certainly more interesting than it was at a euphoric price. But this is ultimately another reminder that a huge decline doesn't automatically produce a cheap stock. Now let's move on to this next stock which has also fallen heavily. The difference is that its growth numbers are still extremely strong. So is trading around $18, down around 30% year to date. And the stock is also towards 52- week lows. At one point, in fact, in the last 12 months, it was sitting around $33. And you'll also note a near strong buy rating from See Alpha, where Wall Street with their hold rating only see 8% upside over the next year. $20 average target price range sitting $12 lower end, 30 at the upper end. Now, compare all of this information with the operating business itself. Revenue was up 41% year-over-year. Full revenue expected to climb still strong 32%. EBIT are projected 47% and forward EBIT near 100%. I mean their forward earnings per share just in the next 12 months expect to climb 28 while the 3 to 5ear figure is actually higher at 39%. Now the obvious push back is going to be their valuation where they trade around 31 times 26 numbers. But it's why earnings trajectory matters so much. The multiple in fact is expected to fall to around 22 based on 2027 numbers and 17 based on 2028 then down to 13 and a half on 2029 where we can in fact see the forward PG sits around.81. Now SoFi is still expensive compared with the broader financial sector on straightforward earnings as well as sales multiples. But that's also because most traditional financial businesses, they're not growing revenue at 30 or 40%. And my valuation model gives $21 at 10% growth. Middle rate $27 at the higher optimistic 36. Now the central figure $27 that sits above the current price today, giving out a 34% margin of safety, but I also want to put an asterisk on the number. SoFi is fundamentally a financial and lending business and conventional corporate free cash flow behaves very different for a financial institution which is why I wouldn't treat the DCF as gospel for me. In fact, the more useful question is whether these earnings estimates are realistic. Because ultimately, if SoFi can continue growing revenue above 30% while profitability scales, then in fact, today's 30 times earning multiple compresses extremely quickly. And that makes SoFi one of the more interesting growth names in the entire group. Now, let's go from 30 plus% growth to a company where investors are expecting almost the exact opposite. And that's Pepsi, which trades at $139, down 3% year to date over the last 12 months, also down and sitting in fact near 52-E lows with just one buy rating and that is weak from Seek Alpha. Now the historical valuation here is probably the entire reason that Pepsi belongs in today's episode. The yield sits at 4.3 compared with a 5year of only three forward P drop below 16. 5 years sitting around 21 where Wall Street only see 11% upside average price target $155. But there also shouldn't be any mystery as to why the multiples fallen. Forward revenue growth is only 3.5%. We can see both EBIT dot as well as EBIT hovering around 4% and long-term earnings per share expected to climb around five. When my DCF gets to $146 and by my multiples approach $188, dividend discount coming to $191. blended value at $175 where the margin of safety comes to around 20%. So for me, Pepsi is an explosive upside story is essentially 16 times earnings and a yield above 4% in a far more attractive starting point than investors have had for many years. And now we get to the stock with by far the ugliest chart in today's video. Tradeesk is down almost 64% year to date. We can see in fact just in the most recent session it was down 22% in pre-market down more than 2% and trading below $14 is barely above their 52- week low which sits around $13 where we get another strong sell from quant hold from Wall Street and a very weak buy from seeking Alpha where Wall Street actually see very rare no upside $14 is where they see this over the next year and the valuation reset is almost difficult to believe forward non-GAAP earnings sits below 12. The 5-year average sits above 54. That's a massive 78% discount. If we take a look, for example, forward with EV to EBIT, that's sitting at 6.4 times. If we take a look at EV to sales, that's sitting below two. So, if all you looked at was the chart and these multiples, the trade desk would look absurdly cheap. But this is where the trade desk differs sharply from a underlying expectations have deteriorated significantly. Forward revenue only expected 4%. Forward EBIT DA in fact negative 8%. Forward EBIT negative 7% and forward earnings per share expected to fall around 12. The earnings trajectory well that also isn't encouraging either. Consensus EPS growth is actually negative 34% for 2026. 27 another decline of roughly 14%. And we can see here the consensus 3 to 5 year EPS growth. Well, it's fallen down to only 5% levered free cash flow growth. Well, that's also negative on a year-on-year basis and moving forwards. But here's where this gets genuinely fascinating. My DCF assumes free cash flow can decline roughly 10% every single year and I still get an intrinsic value of around 18%. That's around 30% above the current share price. So if free cash flow simply stays flat rather than declining 10% annually, it jumps to $32 and with only 5% it gets to 43. The reverse ETF though, that's the number that really jumps off the page. Today's market price is implying something close to 16% long-term growth. So the bull case isn't necessary that trade desk suddenly returns to his old 30% plus growth rate. It can simply be that the business doesn't deteriorate quite as badly as the market currently appears to be pricing. But that's also what makes this dangerous. When a stock has fallen 64%, 11 times adjusted earnings can look irresistible. But if revenue growth keeps slowing, margins deteriorate, and earnings continue to fall, well, you may simply be looking at a value trap before everyone realizes that it's a value trap. So TTD probably the most asymmetric stock in the list. If the market's gone too far, the upside could be enormous. But I need more evidence that deterioration is stabilizing before I rank it above the best opportunity here. And that's why the final stock is so important because here I don't need to assume a turnaround in growth to make the valuation interesting. We've got NU bank, which is down around 17% year to date. Over the last year, it's up around 12%. And in terms of 52- week range, well, it's sitting somewhere towards 52- week lows with a strong buy from C Alpha, respectable buy from Wall Street, where Wall Street in fact see 30% over the next year, $18 price target, range $10 to $22. And the valuation growth combination, well, it's probably one of my favorites today, is trading around 17 times forward gap earnings. Current PG sitting at 045 and forward price to sales, that's sitting around three. Now look at what you're getting for that valuation. Revenue was up 34 1.5% year-over-year. Forward revenue expected something similar at 33. Forward EBIT growth 35%. Forward EPS growth 38 and EPS over the next 3 to 5 years sitting around 36%. And this is probably my favorite valuation progression in the entire episode. Based on current estimate, the P is around 17 in 2026. it falls down to 13 in 27 below 10 in 28 and only about 9.4 in 2029. Now that doesn't mean NU is guaranteed to hit those estimates. It operates in markets with different currency credit and economic risk than a typical US financial company, but you also don't need a huge valuation multiple to generate attractive returns if earnings generally compound anywhere near the current expectations. And because it's a financial company, I've deliberately avoided forcing conventional corporate free cash flow DCF onto it. We can see the Graeme style valuation gives around $27, multiple around 22, blended figure around $24. Wall Street though they're more conservative at around $18. And I wouldn't tell you that NU is definitely worth $24 simply because a spreadsheet says so. What's more important to me is the relationship between the price and the operating performance. app has phenomenal growth, but you're paying a slightly higher earnings multiple. Netflix, well, that's undergone a huge valuation reset, but it's forward revenue growth, that's lower. So, well, that also has extraordinary growth, but it trades closer to 30 times this year's earnings. The Trade Desk is much cheaper, but the growth trajectory, well, that's deteriorated dramatically. And NU gives me roughly 17 times earnings alongside 30 plus% revenue and EPS growth. And if consensus is even broadly correct, the earnings multiple compresses exceptionally quickly. So, of all 10 stocks we've looked at, NU currently gives me the cleanest balance between what I'm paying and the growth I'm potentially receiving in return. So, let's rank all 10 based on what we've seen today. And number 10, we got Figma. I like the growth. I don't yet like paying 80 times forward adjusted earnings for it. Number nine, Rollins, a wonderful business, but 30 plus times earnings still requires a lot for the growth I'm getting. Number eight, Hershey. Much more attractive historically, but I like better evidence that the stronger long-term estimates are actually coming through. Number seven, The Trade Desk. Potentially enormous upside if expectations have become too pessimistic, but also perhaps the highest value trap risk in the group. And number six, Oracle, 18 times earnings alongside phenomenal growth sounds fantastic, but the enormous cash flow demands from the current investment cycle, well, it keeps me more cautious. Number five, Pepsi. Slow growth but 16 times earnings and a yield above 4% while finally creates an attractive starting point. At number four, SoFi. The headline multiple isn't cheap, but the earnings trajectory and operating growth makes it increasingly compelling. At number three, Netflix. Around 20 times forward earnings for potentially 20% longerterm EPS growth. That's a setup I like considerably more than Netflix's historical valuation. Number two, while apploving, the stock has been cut in half while the business continues to produce extraordinary growth. And at today's valuation, expectations look dramatically less demanding. And at number one for me today, it is NU. Not because a spreadsheet gives it the most theoretical upside, but because today's valuation looks unusually reasonable relative to the growth that analysts still expect. And that brings us right back to where we started. the headline market, it can look incredibly strong while dozens of individual stocks underneath it are experiencing completely different realities. And maybe the chase continues and the S&P 500 reaches 8,000, but that doesn't mean I want to chase every stock already making new highs. And equally, a stock being down 60% doesn't automatically make it a bargain. And price declines matter only when you compare them with what's happening to the underlining business. Sometimes the business remains strong and the valuation well it simply resets. Sometimes the stock collapses because the underlining expectations genuinely have deteriorated and occasionally you find something where the growth remains strong while the valuation becomes difficult to ignore. And for me today NU takes that number one spot with app loving and Netflix close behind. But I'm interested to know whether you agree, disagree out of these 10 stocks, which one you'd be most comfortable putting fresh money in today and which one you think is the biggest value trap. And don't forget to sign up to the weekly newsletter. Click below. You can sign up, read all of these straight away. More importantly, have a great day. I'll see you all on the next one.