In this article, we will look at the 12 Worst Depressed Stocks To Buy Now.
Will the “Fed Put” Come into Play?
With the recent pressure on the equity market from tariffs the market has been wondering if the Fed Put will come into play. On March 20, Mike Wilson, Morgan Stanley CIO, and Chief U.S. equity strategist, joined CNBC to discuss the likelihood of interest rate cuts during the year and the overall market outlook. Morgan Stanley expects the year 2025 to have only a single rate cut, however, if the market slows down more than expected then the Fed Put will come into play with another rate cut. Wilson noted that the Fed is going to respond to lower growth, however, the question that remains unanswered is how will the Fed measure this growth. According to Wilson, the labor market is one of the indicators that the reserve is watching closely. Currently, most of the weakness in the labor market is in the government sector as the government is trying to shrink the sector. Wilson noted that if this move spills over to the private sector then there is no doubt that the Fed will respond to that with another rate cut.
Wilson further elaborated that investors are not concerned about the next 12 months, rather they are more curious to know the current market situation. He noted that Morgan Stanley’s view of the market coming into 2025 was that the first half would be tougher due to the high expectations and the government sequencing its policies. One other reason behind this was that market expectations were too high whereas the reality was somewhat different. Wilson noted that we entered this year when the Fed was cutting rates and the valuations were high, so the current market slowdowns are partly due to the much-needed market correction as well. He also noted that there is a growth deceleration going on with the AI capital expenditure as well, which Wilson believes is good as now the expectations are more aligned with reality. He elaborated that these are the reasons why the firm believes that the 5,500 for the S&P 500 is a good level.
Looking ahead to the second half of the year, Wilson acknowledged potential tailwinds from growth-positive policy changes like tax cuts, deregulation, and lower yields. However, he argued that these are too distant for markets to price in currently. He also emphasized that while a “Trump put” may not exist, the “Fed put” remains active but would likely require worsening conditions in labor markets or credit and funding markets, scenarios that would initially be negative for equities.
With that let’s take a look at the 12 worst depressed stocks to buy now.
A close-up view of a chart tracking the performance of the common stocks of a public company.
Our Methodology
To curate the list of 12 worst depressed stocks to buy now we used the Finviz stock screener, Yahoo Finance, and CNN. Using the screener we aggregated a list of stocks that have fallen more than 15% over the past 12 months and are currently trading within 0% to 3% of their 52-week lows. Next, from this aggregated list we shortlisted stocks with more than 20% analyst upside potential. Lastly, we ranked the stocks in descending order of the number of hedge funds that have stakes in them (from best to worst), as of Q4 2024. Please note that the data was recorded on March 19, 2025.
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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
12 Worst Depressed Stocks To Buy Now
12. Lennar Corporation (NYSE:LEN)
52 Week Range: 115.61 – 187.61
Current Share Price: $118.10
Analyst Upside Potential: 22.05%
1-Year Performance: -18.25%
Number of Hedge Fund Holders: 70
Lennar Corporation (NYSE:LEN) is a leading American home construction company that constructs and sells single-family attached and detached homes across the country. It also engages in the purchase, development, and sale of residential land through its various regional segments along with providing mortgage financing, title insurance, and closing services, primarily for its homebuyers.
On March 18, Rafe Jadrosich from Bank of America Securities maintained a Hold rating on the stock, while reducing the price target to $130 from $140. The company recently completed a significant restructuring by spinning off its land assets into a new company called Millrose Properties (MRP), which began trading publicly on February 7, 2025. The analyst noted that the reduced price target reflects the impact of this spin-off. Moreover, Jadrosich has also reduced his 2025 earnings per share forecast by 6%. This revision is based on a more conservative gross margin outlook, citing muted demand and elevated incentives in the housing market. The analyst also highlighted challenging conditions for homebuilders, including weaker demand and ongoing headwinds in the sector. Lennar Corporation (NYSE:LEN) is set to report fiscal Q1 2025 earnings on March 21st. It is one of the worst depressed stocks to buy now.
11. Deckers Outdoor Corporation (NYSE:DECK)
52 Week Range: 115.00 – 223.98
Current Share Price: $115.30
Analyst Upside Potential: 99.48%
1-Year Performance: -23.88%
Number of Hedge Fund Holders: 66
Deckers Outdoor Corporation (NYSE:DECK) is a global company specializing in the design, marketing, and distribution of footwear, apparel, and accessories for both casual lifestyle and high-performance activities. It operates through several key brands and business segments including UGG Brand, HOKA Brand, Teva Brand, and more.
During the fiscal third quarter of 2025, the company achieved its largest and most profitable quarter in history, with revenue growing by 17% year-over-year to $1.8 billion. In addition, the gross margins improved to 60.3%. The strong growth was driven by its exceptional brand performance, with UGG growing 16% year-over-year to $1.2 billion, driven by balanced growth across direct-to-consumer (DTC) and wholesale channels globally. Moreover, HOKA also grew 24% year-over-year to $531 million, with DTC growing by 27% and wholesale by 21%.
Looking ahead, Deckers Outdoor Corporation (NYSE:DECK) plans to phase out its Koolaburra brand to concentrate on more significant organic growth opportunities. The company has raised its fiscal year 2025 outlook, projecting a revenue growth rate of 15%, marking its fifth consecutive year of mid-teens or higher growth. It is one of the worst depressed stocks to buy now as the stock is trading close to its 52-week low.
FPA Queens Road Small Cap Value Fund stated the following regarding Deckers Outdoor Corporation (NYSE:DECK) in its Q4 2024 investor letter:
“Deckers Outdoor Corporation (NYSE:DECK) is a footwear and apparel company that owns the UGG, Hoka, Teva, Sanuk, and Koolaburra brands. Management has done a terrific job growing and extending the UGG franchise and developing Hoka running shoes. We first bought a small position in Deckers in 2015 and 2016 when the company was struggling with supply chain issues. The stock is up more than ten times since then because of excellent operating performance. We have trimmed all the way up. In 2024, the company’s market cap exceeded $20 billion and we trimmed even more substantially. Deckers trades at over thirty times forward earnings (as of Dec. 31, 2024) and we continue to trim.”
10. The Trade Desk, Inc. (NASDAQ:TTD)
52 Week Range: 53.39 – 141.53
Current Share Price: $53.59
Analyst Upside Potential: 105.26%
1-Year Performance: -32.81%
Number of Hedge Fund Holders: 63
The Trade Desk, Inc. (NASDAQ:TTD) is a global advertising technology company specializing in programmatic advertising. It provides a self-service, cloud-based platform that enables advertisers to plan, manage, optimize, and measure data-driven digital ad campaigns across various formats and channels.
On March 18, KeyBanc analyst Justin Patterson lowered the firm’s price target on the stock to $74 from $130, while keeping an Overweight rating on the shares. The company reported a 27% year-over-year revenue increase during the fiscal third quarter of 2024. CTV remained the largest and fastest-growing channel for the company, with partners such as Disney, NBCUniversal, Netflix, Roku, LG, and Walmart deepening their collaboration. Moreover, management noted that the company is expanding in areas such as retail media, identity management, and measurement solutions to strengthen its market position. The Trade Desk, Inc. (NASDAQ:TTD) is also actively exploring ways to integrate AI across its suite of products, algorithms, and features to maintain its competitive edge in the evolving ad tech landscape.
However, the stock has fallen by more than 32% over the past 12 months and is trading close to its 52-week low, thereby making it one of the worst depressed stocks to buy now.
Rowan Street Capital stated the following regarding The Trade Desk, Inc. (NASDAQ:TTD) in its Q4 2024 investor letter:
“The Trade Desk (TTD): Investment Initiated: March 2020
Internal Rate of Return (IRR): 54%
The Trade Desk has been our most successful investment to date. March 2025 will mark five years since we opportunistically initiated our position at a cost basis of $17.40 (split-adjusted). Since then, TTD has appreciated more than sevenfold, delivering an annualized return of approximately 54%.
These exceptional results far outpace the company’s strong fundamental growth, with revenues and earnings compounding at approximately 25% annually over this period (refer to the table below). The primary reason for this outsized return lies in the price at which we were able to acquire TTD during the early days of the pandemic, when market fears briefly drove it down to just 10x revenues. Today, the valuation has expanded significantly to approximately 25x revenues, amplifying our returns…” (Click here to read the full text)
