🏈 Buy these beaten stocks

Good morning Pros! Today’s issue is going to be a little different. Instead of a deep dive, we’ll cover some stocks that are likely to go up in the next few months.

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📊 Stock analysis

Time to Buy these Stocks?

Last week’s market movements erased all gains for the S&P 500 in 2025. The broad market index is now down 1.9% year-to-date. The technology-heavy Nasdaq Composite has declined 5.7%, while the Dow Jones Industrial Average is clinging to a modest 0.6% gain for the year.

Despite the sell-off, the downturn may have been overstated for certain stocks. To identify these opportunities, we screened data for stocks deemed technically oversold based on their 14-day relative strength index (RSI).

An RSI below 30 suggests a stock is oversold and may be poised for a rebound, while an RSI above 70 indicates a stock may have risen too quickly and could face a pullback. In addition, we saw what Goldman Sachs had to say and identified some top names that are likely to go up soon.

Hewlett Packard Enterprise: Oversold with Upside Potential

Hewlett Packard Enterprise (HPE) stock plummeted after the information technology company issued a weaker-than-expected second-quarter outlook and announced plans to lay off 2,500 workers—approximately 5% of its workforce.

This followed first-quarter earnings that met analyst expectations, with revenue slightly exceeding forecasts.

HPE’s 14-day RSI of 9.65 is the lowest on the oversold list, signaling a significant oversold condition. Analysts surveyed by LSEG maintain a consensus buy rating, with an average price target suggesting over 56% upside.

American Express: Banking Sector Struggles but Signs of Recovery

American Express also appeared on the oversold list, with its stock down nearly 8% in 2025. The broader banking sector has faced sharp declines this year, despite initial optimism following Trump’s election last November, which raised hopes for clearer regulatory policies.

American Express’s 14-day RSI of 23.49 indicates the stock may be due for an uptick.

Analysts project a consensus price target implying more than 17% upside from Thursday’s close. The company recently boosted its quarterly dividend by over 17% and announced plans to acquire expense management startup Center.

Walmart: A Retail Giant with Room to Grow Strong Performance and Optimistic Outlook

Walmart shares have surged over 50% in the past 12 months, yet Goldman Sachs believes there’s still upside potential. Analyst Kate McShane remains bullish following the company’s fiscal fourth-quarter earnings, which exceeded expectations on revenue and earnings despite underwhelming guidance. McShane anticipates “continued share gains” and “solid earnings growth in 2025,” driven by Walmart’s “compelling proposition for value and convenience” and an improving profitability profile.

With an investor meeting scheduled for April, McShane expects updates on strategy and initiatives—like automation—to serve as a positive catalyst for the stock. She reiterates a Buy rating on Walmart with a price target of $106, signaling confidence in its trajectory.

It has an RSI of 28, yet Goldman Sachs and some other experts believe it is a buy. However, the opinion on Walmart is mixed with some thinking there may be challenges ahead due to the tariff situation. Nonetheless, the average price target is $112.04 with a high forecast of $120.00 and a low forecast of $99.00. The average price target represents a 22.15% change from the last price of $91.72.

Cheesecake Factory: A Leader in Full-Service Dining Strong Results Reinforce Growth 

Cheesecake Factory’s solid fourth-quarter performance has Goldman Sachs reaffirming its bullish stance. The company’s results underscore its position as offering “the most compelling unit growth story” in the full-service restaurant (FSR) sector.

The brand’s latest menu, featuring over 20 new items, continues its unique strategy of diverse offerings to eliminate diners’ veto power when choosing a restaurant. Goldman sees this as a key factor supporting the bull case for Cheesecake Factory stock.

It has a 14 day RSI of 46 with a divided opinion. We think it’s a hold, however, Goldman Sachs appears very keen on this name. The average price target is $56.20 with a high forecast of $66.00 and a low forecast of $40.00. The average price target represents a 14.32% change from the last price of $49.16.

Ducommun: An Undervalued Aerospace Opportunity

Goldman Sachs analyst Noah Poponak urges investors not to overlook Ducommun, an aerospace engineering services company. Despite a mixed fourth-quarter report in late February and an 11% year-to-date drop in its stock price, Poponak calls it undervalued. He points to a “medium-term outlook for aerospace growth and margin expansion” as a key driver.

Poponak notes that Ducommun has steadily enhanced its margins and cash flow conversion, bolstered by the tailwind of commercial aerospace growth. “We expect company-specific operating fundamentals to continue improving,” he says, maintaining a Buy rating on the stock.

Despite major changes, we think this stock is an interesting option; however, it has a very high RSI of 42. The average price target for Ducommun is $77.00. This is based on 2 Wall Streets Analysts 12-month price targets, issued in the past 3 months. The highest analyst price target is $82.00 ,the lowest forecast is $72.00. The average price target represents 33.56% Increase from the current price of $57.65.

Caution: On the flip side, Yum! Brands and Verizon emerged as overbought, with 14-day RSI readings of 82.13 and 75.34, respectively. These elevated levels suggest their recent gains may have gone too far, potentially setting the stage for a pullback.

📊 Analysis

Defensive Stocks Shine Amid Tariff-Driven Market Volatility

The S&P Index is down -4.88% in the last 30 days but some stocks have beaten the market. Most belong to the same niche, including defensive stocks. Here are our top picks:

Archer-Daniels-Midland: High Yield, Steady Gains

Crop and ingredient company Archer-Daniels-Midland (ADM) with a dividend yield of 4.45% is set to roar. ADM is less volatile than the broader market with a 15% upside from current levels. It is up 7.32% in the last 30 days.

Allstate: Low Volatility, High Upside

Significantly less volatile than the market, this insurance firm has jumped 3% over the past month and offer a dividend yield of exactly 2%. Analysts’ average price target points to more than 15% upside.

Molson Coors: Brewing Stability and Growth

Molson Coors, the beer brewer, with a dividend yield of about 3.2% is less volatile than the market and may offer good returns. The stock has climbed over 9% in the past month, and analysts’ average price target indicates more than 11% potential upside ahead.

These have performed better than the market, but there’s no guarantee that they’ll do well in the future as well. Make sure to look at all factors before investing.

📰 Investment of the Week

Tariff Fears Open Doors of Opportunities

Investor sentiment has soured in recent weeks as President Trump’s tariff threats have driven market volatility, pushing the S&P 500 and Invesco QQQ Trust below their 200-day moving averages for the first time in nearly 400 trading days.

Despite last month’s optimism fading and the VIX spiking, the average U.S. stock is now 30% off its 52-week high, signaling fear rather than fundamental weakness.

We see this uncertainty—coupled with lower interest rates (10-year note at 4.12%), a weaker dollar, and crude oil prices in the $60s—as a buying opportunity for U.S. equities.

Using a risk reversal options strategy on the SPDR S&P 500 ETF Trust (SPY), selling a $560 put for $8.00 and buying a $580 call for $7.80, investors can net $0.20 per spread while positioning for upside if volatility subsides by March 28, 2025.

With SPY at $571.50, this trade risks owning SPY at $559.80 if it falls below $560, but offers unlimited upside above $579.80—capitalizing on our belief that equities will rebound once tariff concerns settle, supported by unchanged market fundamentals and an old trading adage: “Be greedy when others are fearful.”

👩🏽‍⚖️ Legal Stuff
Nothing in this newsletter is financial advice. Always do your own research and think for yourself.