In this article, we will discuss the 10 Worst Beaten Down Stocks to Buy Now.
In 2024, the broader financial markets and economy stood up well amidst economic uncertainty, higher interest rates, and the US presidential election, according to Edward Jones, a financial services company providing wealth management, and other services. The US economic growth was consistently above trend, households continued to spend, inflation moderated, and the broader S&P 500 saw an increase of over 20% for the 2nd consecutive year.
What Lies Ahead?
As 2025 begins, much of the positive economic momentum from 2024 is expected to continue, although the pace of economic growth and US stock market gains might cool, according to Edward Jones. The firm expects that the US GDP growth will moderate but is likely to remain positive, courtesy of a healthy consumer and labor market. The conditions for US households are expected to improve moving forward, with the US Fed cutting the rates and inflation continuing to moderate. Furthermore, wage growth is expected to remain above inflation rates, exhibiting that consumers will continue to benefit from positive real wages.
Edward Jones expects that market leadership will broaden beyond the US mega-cap technology stocks in 2025, with investors looking for investments having increased domestic exposure and potential for growth in earnings and valuation expansion. It anticipates a balance in performance between value- and growth-style stocks, which strengthens the case for portfolio diversification.
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.
US Labor Market Trends in 2025
It seems that the main source of strength for the broader US economy is its resilient labor market. When consumers’ employment is secure, they feel confident when it comes to spending, and consumer spending accounts for ~70% of the US GDP, says Edward Jones. The firm expects that the US labor market seems to be normalizing. Just like the economic growth, it expects to witness a reacceleration of the labor market towards the end of 2025.
Notably, the reduced borrowing costs, higher use cases in AI, and potential pro-growth policies are expected to fuel hiring activity. The labor market outlook can also be influenced by the new immigration policy. In case of a significant reduction in the US labor force, there might be a supply shock. As per Edward Jones, this might force employers to increase wages, mainly in low-cost labor industries including restaurants, manufacturing, and hospitality.
Amidst such trends, investors are required to consider companies trading at low valuations and having healthy fundamentals, which strengthen the case for a positive long-term outlook.
With this in mind, let us now have a look at the 10 Worst Beaten Down Stocks to Buy Now.
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Our Methodology
To list the 10 Worst Beaten Down Stocks to Buy Now, we used a screener and chose the stocks that were trading close to their 52-week lows. Next, we filtered out the ones that analysts see significant upside to. Finally, the stocks were arranged in ascending order of their average upside potential, as of February 20. We also mentioned the hedge fund sentiment around each stock, as of Q4 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 363.5% since May 2014, beating its benchmark by 208 percentage points (see more details here).
10 Worst Beaten Down Stocks to Buy Now
10) PTC Inc. (NASDAQ:PTC)
Stock Price as of February 20: $161.6
52-week Low: $161.6
Average Upside Potential: ~28.5%
Number of Hedge Fund Holders: 56
PTC Inc. (NASDAQ:PTC) operates as a software company in the Americas, Europe, and the Asia Pacific. The company’s product portfolio spans critical areas including industrial software, which includes Product Lifecycle Management (PLM), Application Lifecycle Management (ALM), Internet of Things (IoT), and AR solutions. Therefore, this diverse offering places PTC Inc. (NASDAQ:PTC) well to capitalize on ongoing digital transformation trends throughout various industries.
With industrial companies ramping up their digital transformation initiatives, the company is expected to witness higher demand throughout its solution set. PTC Inc. (NASDAQ:PTC)’s Codebeamer product, in particular, is expected to act as a critical growth driver in the broader ALM space. Furthermore, the integration of ServiceMax into PTC Inc. (NASDAQ:PTC)’s portfolio can act as the next growth driver in the field service management market.
With industrial companies focusing on aftermarket services and predictive maintenance, its ability to provide end-to-end solutions, ranging from product design to service, can be a critical differentiator. PTC Inc. (NASDAQ:PTC) has also announced the release of the ServiceMax AI field service management assistant powered by GenAI. ServiceMax AI will help in enabling service organizations to modernize workflows and the technician experience.
9) L3Harris Technologies, Inc. (NYSE:LHX)
Stock Price as of February 2o: $199
52-week Low: $193.09
Average Upside Potential: ~30.8%
Number of Hedge Fund Holders: 48
L3Harris Technologies, Inc. (NYSE:LHX) offers mission-critical solutions for government and commercial customers. TD Cowen analyst Gautam Khanna maintained a bullish stance on the company’s stock, providing a “Buy” rating. The analyst’s rating is backed by robust financial guidance for the coming years and strategic initiatives. L3Harris Technologies, Inc. (NYSE:LHX) gave an initial 2025 sales forecast aligning with the market expectations. Notably, for 2025, the company is expecting revenues in the range of $21.8 billion – $22.2 billion and an adjusted FCF of $2.4 billion – $2.5 billion.
Also, the company continues to make strides in its cost-saving initiatives, which can enhance margins and efficiencies, potentially surpassing conservative margin guidance. The management’s focus on improving performance in legacy programs and enhancing the operational capacity further enhances L3Harris Technologies, Inc. (NYSE:LHX)’s prospects. The increasing international demand for defense technologies provides a strong growth opportunity for the company. L3Harris Technologies, Inc. (NYSE:LHX)’s strong position in areas like resilient communications, night vision systems, and solid rocket motors remains in line with global defense priorities. The success in international markets might offer L3Harris Technologies, Inc. (NYSE:LHX) economies of scale, resulting in improved margins and overall profitability.
8) PulteGroup, Inc. (NYSE:PHM)
Stock Price as of February 20: $103.1
52-week Low: $101.1
Average Upside Potential: ~30.9%
Number of Hedge Fund Holders: 40
PulteGroup, Inc. (NYSE:PHM) is engaged in the homebuilding business in the US. Analyst Rafe Jadrosich from Bank of America Securities reiterated a “Buy” rating on the stock and has a $134.00 price target. The company’s strategy to increase its land position via options contracts can enhance its financial performance in the coming years. The analyst further believes that with seasonal fluctuations impacting order numbers, PulteGroup, Inc. (NYSE:PHM)’s order activity in January remains aligned with typical seasonal patterns, reflecting improvement.
Elsewhere, UBS upped the company’s stock to “Buy” from “Neutral.” PulteGroup, Inc. (NYSE:PHM)’s gross margins and RoE are well-placed to continue leading peers, while the company’s current customer mix aids in profitability and offers some diversification in an ever-evolving homebuying market. The potential interest rate relief can benefit PulteGroup, Inc. (NYSE:PHM) over the long term. Notably, lower interest rates can make homeownership more accessible to a broader range of buyers, resulting in higher demand for the company’s business. Analysts at JPMorgan maintained an “Overweight” rating on the company’s stock as they believe that PulteGroup, Inc. (NYSE:PHM)’s stock valuation remains attractive as compared to peers, thanks to the potential for gross margins and return on equity.
7) Westlake Corporation (NYSE:WLK)
Stock Price as of February 20: $109.7
52-week Low: $108.5
Average Upside Potential: ~31.9%
Number of Hedge Fund Holders: 34
Westlake Corporation (NYSE:WLK) engages in the manufacture and marketing of performance and essential materials, and housing and infrastructure products in the United States, Canada, Germany, China, Mexico, Brazil, France, Italy, Taiwan, and internationally. Truist initiated coverage of the company’s shares with a “Buy” rating and a price target of $168. As per the analyst, Westlake Corporation (NYSE:WLK) managed to create a vertically integrated market leader in its core business by assembling synergistic chemicals and building a products portfolio.
Westlake Corporation (NYSE:WLK) expects that monetary and fiscal stimulus, which includes actions by the Federal Reserve and the Chinese government, can accelerate the pace and duration of the macroeconomic recovery. The company remains focused on its levers for growth, which include developing and commercializing innovative new products to help customers cater to their needs and improve the profitability and reliability of the plants. Westlake Corporation (NYSE:WLK) remains well-placed to capitalize on M&A opportunities, potentially acquiring complementary businesses or technologies capable of enhancing its competitive position or expanding the product portfolio.
Furthermore, the robust financial position allows the company to invest in organic growth initiatives, including capacity expansions or efficiency improvements, without impacting the balance sheet. This can help Westlake Corporation (NYSE:WLK) outpace the market trends and sustain its technological edge.
6) Carlisle Companies Incorporated (NYSE:CSL)
Stock Price as of February 20: $334.8
52-week Low: $332.34
Average Upside Potential: ~33.3%
Number of Hedge Fund Holders: 42
Carlisle Companies Incorporated (NYSE:CSL) operates as a manufacturer and supplier of building envelope products and solutions. The company saw record EPS with FY 2024 revenue growth of 9% together with a record adjusted EBITDA margin of 26.6% and ROIC of 28.5%. Its adjusted EPS came in at $20.20, reflecting a rise of 30% YoY. These results were aided by resilient and recurring re-roofing revenue, which more than offset the negative impact of the broader challenging construction environment. Carlisle Companies Incorporated (NYSE:CSL) continues to progress towards its Vision 2030 target of $40 of adjusted EPS.
Notably, Vision 2030 places the company well to benefit from the widely understood macro-trends, which include growing commercial re-roofing demand, a housing shortage, and its ability to offer energy-efficient and labor-saving solutions and systems. Carlisle Companies Incorporated (NYSE:CSL) anticipates CCM business (Carlisle Construction Materials) to benefit from solid re-roofing demand, new products, the full year of the MTL acquisition, and, as it enters H2 2025, improving new construction markets.
In 2025, for CCM, Carlisle Companies Incorporated (NYSE:CSL) expects revenues to increase in the mid-single-digit percentage range YoY. However, CWT (Carlisle Weatherproofing Technologies) is expected to improve performance on share gain initiatives, new products, and the integration of Plasti-Fab and ThermaFoam.
5) Booz Allen Hamilton Holding Corporation (NYSE:BAH)
Stock Price as of February 20: $112.3
52-week Low: $110.5
Average Upside Potential: ~33.5%
Number of Hedge Fund Holders: 48
Booz Allen Hamilton Holding Corporation (NYSE:BAH) is a provider of management consulting services to the US government. In Q3 2025, the company’s revenue increased 13.5% to $2.9 billion, and revenue, excluding billable expenses, increased 11.8% to $2.0 billion. The revenue growth was mainly aided by robust demand for its services and solutions. Booz Allen Hamilton Holding Corporation (NYSE:BAH)’s long-term outlook is aided by its strong backlog and strategic partnerships. Such factors place it well for continued growth, mainly in sectors including AI and cybersecurity.
The company and Palantir Technologies Inc. jointly announced a co-creation partnership to accelerate defense mission innovation and help the US maintain superiority against its adversaries. This partnership builds on several previous strategic collaborations between the companies to help signature programs for the US government. In another positive development, Booz Allen Hamilton Holding Corporation (NYSE:BAH) and Amazon Web Services (AWS) announced an expanded partnership and strategic collaboration agreement to improve technology outcomes and efficiencies for the US government. With strong strategic momentum and efficient operations fueled by VoLT (Velocity, Leadership, Technology), Booz Allen Hamilton Holding Corporation (NYSE:BAH) is well-placed for near to medium-term growth.
Carillon Tower Advisers, an investment management company, released its Q4 2024 investor letter. Here is what the fund said:
“Booz Allen Hamilton Holding Corporation (NYSE:BAH) is a technology services provider to the defense, intelligence, and civil markets. Booz Allen has benefitted from the long-term adoption and upgrade of the U.S. government’s digital capabilities. However, investors have become concerned that the incoming administration will focus on efficiency and consulting companies like Booz Allen might have a more difficult time winning contracts. We believe that the deep capabilities and the critical nature of the services provided to the U.S. government by Booz Allen cannot be dismissed easily and despite efficiency being an admirable goal, the company remains on a solid footing.”
4) D.R. Horton, Inc. (NYSE:DHI)
Stock Price as of February 20: $125.9
52-week Low: $124.2
Average Upside Potential: ~35.3%
Number of Hedge Fund Holders: 60
D.R. Horton, Inc. (NYSE:DHI) operates as a homebuilding company. The company’s scale and operational efficiency are playing as key strengths amidst the competitive homebuilding landscape. D.R. Horton, Inc. (NYSE:DHI)’s ability to provide a diverse range of products at competitive prices places it well to capture market share, mainly in an environment where affordability is a concern for homebuyers.
Even though the level of new and existing home inventories increased from historically low levels, the supply of homes at affordable price points remains limited, and demographics supporting housing demand are favorable. D.R. Horton, Inc. (NYSE:DHI) stated that, amidst continued affordability challenges and a competitive market, incentives including mortgage rate buydowns have aided in addressing affordability and spurring demand. D.R. Horton, Inc. (NYSE:DHI) is well-placed with its affordable product offerings and flexible lot supply.
The company has diverse product offerings and a national footprint, which have placed it well to capitalize on the expected shift to the single-family housing market. D.R. Horton, Inc. (NYSE:DHI)’s scale and operational efficiency enable it to deliver homes at competitive prices, which can be beneficial in addressing the affordability challenges. Parnassus Investments, an investment management company, released the Q3 2024 investor letter. Here is what the fund said:
“D.R. Horton, Inc. (NYSE:DHI), a leading homebuilder, saw its shares rise amid confidence that a lower-rate environment would lead to more affordable housing prices and a corresponding increase in home buying. Further, investors were impressed by the company’s execution and management’s intention to deploy cash to a stock buyback.”
3) NICE Ltd. (NASDAQ:NICE)
Stock Price as of February 20: $155.3
52-week Low: $147.3
Average Upside Potential: ~38.3%
Number of Hedge Fund Holders: 28
NICE Ltd. (NASDAQ:NICE) offers cloud platforms for AI-driven digital business solutions. The company continues to invest significantly in product innovation, with a strong focus on AI-powered solutions. It has recently introduced CXone Mpower, which is a comprehensive AI platform combining Copilot, Autopilot, and actions to orchestrate customer journeys. Therefore, this launch reflects NICE Ltd. (NASDAQ:NICE)’s commitment to staying ahead of AI-driven customer experience technologies.
The advanced AI capabilities can support the company in differentiating its offerings in a competitive market, resulting in higher win rates and larger deal sizes. Furthermore, AI-driven solutions can allow NICE Ltd. (NASDAQ:NICE) to expand into adjacent markets or use cases, further enhancing its total addressable market. The company’s FY 2024 robust top-line results were aided by a 25% YoY growth in cloud revenue, which reached $2 billion.
NICE Ltd. (NASDAQ:NICE)’s Chief highlighted that AI has been revolutionizing the CX industry, and CXone Mpower’s agentic AI continues to unlock new growth levels by delivering further efficiency and healthy customer experiences. The company’s outstanding operating cash flow growth in 2024, which rose 48% YoY to $833 million, places NICE Ltd. (NASDAQ:NICE) well with a significant competitive advantage to fuel future organic and inorganic expansion.
2) Omnicom Group Inc. (NYSE:OMC)
Stock Price as of February 20: $82.3
52-week Low: $80.3
Average Upside Potential: ~39.7%
Number of Hedge Fund Holders: 36
Omnicom Group Inc. (NYSE:OMC) provides advertising, marketing, and corporate communications services. The broader marketing and communications industry has been witnessing significant change, fueled by technological advancements, changes in consumer behavior, and the evolution of client needs. Omnicom Group Inc. (NYSE:OMC)’s ability to navigate such changes successfully remains crucial to its continued success. The strong organic growth and supportive industry trends are likely to place the company well to capitalize on emerging opportunities in the sector.
Omnicom Group Inc. (NYSE:OMC)’s healthy 5.2% organic revenue growth for both Q4 2024 and FY 2024, even higher growth in adjusted EBITA and adjusted EPS, and its healthy operational execution provide confidence for continued strength in 2025. The company remains well-prepared for the complementary combination of businesses with its proposed acquisition of Interpublic. Omnicom Group Inc. (NYSE:OMC) expects strong upside potential via expected revenue and cost synergies, which can drive growth beyond what the company was delivering alone.
With a diverse portfolio, the company remains well-positioned to expand its global footprint and continue providing creative solutions in the dynamic market. Omnicom Group Inc. (NYSE:OMC)’s fundamental catalysts consist of the expansion into new products and markets and growth stemming from cutting-edge creative solutions. Its diverse service offerings support a broad market appeal, and the company’s delivery of intelligent business outcomes for clients can aid long-term sustainability.
1) CACI International Inc (NYSE:CACI)
Stock Price as of February 20: $327.0
52-week Low: $327.0
Average Upside Potential: ~64.3%
Number of Hedge Fund Holders: 48
CACI International Inc (NYSE:CACI) is engaged in the provision of expertise and technology to enterprise and mission customers in support of national security in the intelligence, defense, and federal civilian sectors. Raymond James analyst Brian Gesuale upped the company’s price target to $490 from $475, keeping an “Outperform” rating. The firm believes that CACI International Inc (NYSE:CACI)’s fundamentals continue to trend above historical averages, and the management’s confidence and visibility in the business remain strong considering the raised guidance.
Notably, the company has increased its FY 2025 revenue guidance, courtesy of higher organic growth expectations. CACI International Inc (NYSE:CACI) now expects revenues to come in the range of $8,450 million – $8,650 million as compared to the previous range of $8,370 million – $8,570 million. The focus on strategic investments, mainly in technology and capabilities aligned with government priorities, places CACI International Inc (NYSE:CACI) well for long-term success.
Through continuous investments, CACI International Inc (NYSE:CACI) is expected to further enhance its competitive edge in securing high-value contracts in critical areas including national security, intelligence, and defense. Meridian Funds, managed by ArrowMark Partners, released its Q3 2024 investor letter. Here is what the fund said:
“CACI International Inc (NYSE:CACI) is an IT consultant and provider of mission-critical technology to the U.S. Government and its agencies, which account for nearly 95% of its sales. CACI plays a vital role in modernizing IT infrastructure, systems, and other essential defense needs for the U.S. We have held CACI for over 10 years as the company has consistently grown into a larger supplier to the U.S., and increasingly, to our allies. The company’s stable growth and role as an essential provider of U.S. defense infrastructure were recognized by the market, delivering a solid return for shareholders in the quarter. We maintained our position throughout the period and, as of quarter-end, CACI was the Fund’s largest holding.”
While we acknowledge the potential of CACI as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a deeply undervalued AI stock that is more promising than CACI but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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