10 Best 52-Week Low Stocks To Buy Now
In this article we present the list of 10 Best 52-Week Low Stocks To Buy Now. Click to skip ahead and see the 5 Best 52-Week Low Stocks To Buy Now.
Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Meta Platforms, Inc. (NASDAQ:META) are three of the biggest companies in the world that have all hit 52-week lows this month.
With a recession looming and a bear market having taken hold this year, it’s not surprising that many stocks are hovering around 52-week lows. It is rare to see so many high quality stocks get beaten down to the degree they have in recent months however. The four most popular stocks among hedge funds have all touched 52-week lows since November 3, creating a great opportunity for investors to buy low on some of the most respected companies in the world.
Scanning the market for stocks at 52-week lows is a time-honored tradition among value investors, who covet the opportunity to buy quality companies with long track records of success at discounted prices. In many cases, such companies are merely caught in cyclical lows, without any real change to their long-term fundamental outlook that justifies their shares trading at their lowest point in a year or more.
There are several technical reasons why stocks at 52-week lows can make good short-term buys as well. As stocks reach new yearly lows, short sellers are more likely to have profited from their positions and will look to buy shares to cover them. Bargain hunters, like the aforementioned value investors, are also more likely to start buying shares when they cross the 52-week low threshold, which can provide them with an immediate, though potentially short-lived, boost.
That doesn’t mean every stock at a 52-week low is necessarily poised for a rebound however, either in the short or long term, which is evidenced by multiple stocks on this list, which have fallen to 2+ year lows. If you had bought these stocks earlier this year expecting a rebound by this point, you’d be sorely disappointed, as they’ve continued to trend down amid the tough economic backdrop.
As with any investment decision, investors need to ask themselves why these stocks are at 52-week lows and whether their long-term outlook has changed enough in the last year to justify those new lows. If that doesn’t appear to be the case, it could be that the stock was simply overvalued a year ago and has fallen back to a more realistic valuation, which has happened to quite a number of growth stocks this year.
We’ll try to answer some of those burning questions in this article as we take a look at 10 of the best 52-Week Low Stocks to buy now.
Image by Gerd Altmann from Pixabay
The following 52-week low stocks are ranked based on hedge fund sentiment. We follow a select group of hedge funds because Insider Monkey’s research has uncovered that their consensus stock picks can deliver outstanding returns.
All hedge fund data is based on the exclusive group of 900+ funds tracked by Insider Monkey that filed 13Fs for the Q2 2022 reporting period.
10 Best 52-Week Low Stocks To Buy Now
10. Edwards Lifesciences Corporation (NYSE:EW)
Number of Hedge Fund Shareholders: 39
1-Year Share Price Decline: 36%
Meta Platforms, Inc. (NASDAQ:META), Microsoft Corporation (NASDAQ:MSFT), and Amazon.com, Inc. (NASDAQ:AMZN) are several stocks worth buying now that have all hit 52-week lows within the last week. Another is medical device maker Edwards Lifesciences Corporation (NYSE:EW), whose shares touched a 52-week low on November 4, a week after the release of the company’s Q3 results.
Edwards Lifesciences shares fell by 17.9% on October 28 after the company announced Q3 sales of $1.32 billion and pro forma EPS of $0.61, both of which represented slight misses compared to consensus estimates. Sales grew just 1% year-over-year during the quarter, but 7% on a constant currency basis. The company’s Q4 pro forma EPS guidance of between $2.40 and $2.50 also fell below estimates, as well as the company’s earlier guidance. Despite the sell off and EW shares hitting a 52-week low, they still trade at 31.2x earnings, which is rich given the tepid Q3 growth, but the company looks to have a compelling long-term growth runway ahead of it.
Hedge fund ownership of Edwards Lifesciences Corporation (NYSE:EW) dipped by 13% during Q2 after ticking up for two straight quarters. Ken Fisher’s Fisher Asset Management owned the largest stake in EW as of June 30 among the select group of funds tracked by Insider Monkey’s database, holding 7.33 million shares worth $697 million.
Wedgewood Partners believes that Edwards Lifesciences Corporation (NYSE:EW)’s growth should accelerate in the years to come, as discussed in its Q3 2022 investor letter:
“Edwards Lifesciences Corporation (NYSE:EW) reported just +5% growth in revenue (foreign exchange adjusted) compared to a year ago. While this quarter represented a deceleration in revenue growth from earlier this year, much of that was due to hospital staffing shortages and the vagaries of global healthcare systems emerging from pandemic disruptions. The Company received FDA approval for its minimally invasive mitral valve repair system, PASCAL, and also presented compelling related clinical data, which should help support accelerating growth over the next few years. As for Edwards’ core TAVR system, there continues to be a (unfortunately) pent-up, untreated population suffering from severe aortic stenosis that will finally be able to find their way back into healthcare systems as labor market pressures ease.”
9. Fortinet Inc (NASDAQ:FTNT)
Number of Hedge Fund Shareholders: 43
1-Year Share Price Decline: 18%
Fortinet Inc (NASDAQ:FTNT) shares hit a 52-week low on November 3 following the release of its Q3 results and underwhelming billings guidance for Q4. The cybersecurity company’s Q3 results were pretty good, as sales rose by 33% year-over-year to $1.15 billion, slightly topping estimates, while non-GAAP EPS grew by 65% from a year earlier to $0.33 and easily beat consensus.
Fortinet Inc (NASDAQ:FTNT)’s Q4 billings guidance left something to be desired with investors however, coming up short of the $1.74 billion consensus estimate, even at the top end of the company’s range. Management cited the uncertain macro-economic environment when drawing up its guidance, which may have caused additional near-term investor concerns. Longer-term, Fortinet looks like a strong bet to continue growing at a steady pace in the burgeoning cybersecurity space, which makes its recent weakness a good buying opportunity.
Hedge funds sold off Fortinet Inc (NASDAQ:FTNT) in droves shortly into the pandemic, with the stock hitting a 7-year low in smart money ownership at the end of Q1 2021. There’s been an 83% surge in the number of funds long FTNT since then, including a 13% rise in Q2 2022. The company’s biggest bulls were all loading up on shares in Q2, as seven of the eight funds with the largest Fortinet holdings as of June 30 increased the size of their stakes by at least 360% during the quarter.
8. The Estee Lauder Companies Inc (NYSE:EL)
Number of Hedge Fund Shareholders: 46
1-Year Share Price Decline: 34.2%
The Estee Lauder Companies Inc (NYSE:EL) shares hit a 52-week (and 2-year) low on November 2, but have since rebounded by 20% in the last week. The cosmetic company’s sales fell by 11% year-over-year during its Q1 of fiscal year 2023, sliding to $3.93 billion, while organic net sales dipped by 5%. Adjusted earnings tumbled by 28% year-over-year to $1.37 per diluted share.
The Estee Lauder Companies Inc (NYSE:EL) anticipates a rough fiscal Q2 due to various headwinds, including the strong U.S. dollar and tighter inventory management among retailers. The company projects diluted earnings will fall by as much as 54% year-over-year during the quarter. Management expects those headwinds to begin abating in the second half of its fiscal 2023 however, with a return to strong organic sales and adjusted EPS growth.
Hedge fund ownership of The Estee Lauder Companies Inc (NYSE:EL) shot up during the first quarter of 2021, but has fallen by 24% since then. It has ticked up slightly this year as shares have fallen however, as hedge funds appear to like EL’s upside potential at the current depressed prices. Terry Smith’s Fundsmith LLP owns 5.95 million EL shares as of June 30, with 6.68% 13F exposure to the stock. Ray Dalio’s Bridgewater Associates cut its stake in the company by 16% during Q2 to own 612,560 shares at the end of the quarter.
7. Global Payments Inc. (NYSE:GPN)
Number of Hedge Fund Shareholders: 57
1-Year Share Price Decline: 20.7%
Global Payments Inc. (NYSE:GPN) shares tumbled to a 3-year low on November 3 despite the company soundly beating revenue estimates with its third quarter results. The fintech company grew revenue by 3.8% year-over-year during Q3 to $2.29 billion, beating estimates by $250 million. Adjusted EPS rose $0.30 year-over-year to $2.48, which matched estimates. On a constant currency basis, Global Payments expects to grow revenue by 10% to 11% this year.
The 3-year low for GPN shares was spite of the company finding a buyer for its Netspend consumer business earlier this year, which netted the company $1 billion in cash and will allow it to focus on its primary B2B operations.
Hedge fund ownership of Global Payments Inc. (NYSE:GPN) peaked at the end of Q3 2021, but has fallen for the past three straight quarters as shares have started to tumble. There’s been a 16% decline in the number of funds long GPN during that period. Larry Robbins’ healthcare-focused Glenview Capital Management is a firm bull on GPN, owning 2.35 million shares on June 30, with the stock ranking as the fund’s top non-healthcare pick.
Manole Capital Management has been a long time bull of Global Payments Inc. (NYSE:GPN) and had this to say about the company in its Q2 2022 investor letter:
“Over the next week or so, we will be publishing a stock-specific note on payment processor Global Payments Inc. (NYSE:GPN). We have owned GPN for nearly two decades and it currently is one of our largest positions. We will begin by highlighting recent spending trends, eCommerce developments and how many of our payment companies can actually benefit from inflation and higher costs. We will discuss their business, industry trends, what is driving their growth, and then highlight their compelling valuation.”
6. Zoetis Inc. (NYSE:ZTS)
Number of Hedge Fund Shareholders: 62
1-Year Share Price Decline: 31.5%
Closing out the first half of the list is Zoetis Inc. (NYSE:ZTS), whose shares hit a 2-year low on November 4. The animal healthcare giant slashed its 2022 sales guidance by between $150 million and $225 million on November 3, in addition to cutting its earnings projections, which triggered a flight from the stock. The company cited several headwinds as being contributors to the weaker projections, including unfavorable currency exchange rates, supply chain obstacles, and staffing challenges at veterinarian offices. The company otherwise remains bullish on its long-term outlook and growth catalysts thanks to its pipeline and global scale, predicting market-beating sales growth in the years to come.
Hedge fund ownership of Zoetis Inc. (NYSE:ZTS) hit an all-time high at the end of Q1 even as shares started tumbling, though there was a slight pullback in Q2. Barry Dargan’s Intermede Investment Partners and Nicolai Tangen’s Ako Capital each owned more than 1 million ZTS shares on September 30 and had 4.39% and 3% 13F exposure to the stock respectively.
The Baron Health Care Fund talked about some of the recent developments at Zoetis Inc. (NYSE:ZTS) in its Q1 2022 investor letter:
“Shares of Zoetis Inc., the global leader in the discovery, development, and manufacturing of companion and farm animal health medicine and vaccines, fell along with shares of other high-multiple 2021 standout performers. We retain conviction as Zoetis recently reported a top and bottom line beat with more than 21% growth driven by dermatology, parasiticides, and recently launched monoclonal osteoarthritic treatments. The company’s 2022 guidance was in line with Street expectations, calling for 9% to 11% operational revenue growth and modest margin expansion despite heavy investment in core growth drivers.”
Amazon.com, Inc. (NASDAQ:AMZN), Meta Platforms, Inc. (NASDAQ:META), and Microsoft Corporation (NASDAQ:MSFT) are three of the most popular stocks in the world that can currently be had for bargain basement prices. Check out the details by clicking the link below.
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Disclosure: None. 10 Best 52-Week Low Stocks To Buy Now is originally published at Insider Monkey.