Redemption Road: 3 of Last Year’s Worst Stocks Are Eyeing a 2024 Win

Stocks to buy

With such a surprisingly strong performance printed last year, it’s only natural to consider going with the flow, not abruptly shifting gears with stock comeback predictions. Yeah, going contrarian is a sexy concept, I get it. However, turnaround stocks come with significant risks.

While the aphorism of buy low, sell high permeate popular culture, the idea can be misconstrued. It doesn’t mean that you just react to red like a (biological) bull would. Instead, you need to be extremely selective with your contrarianism. Even then, no guarantees exist. After all, rebounding stocks imply that there was a terrible event to rebound from.

Nevertheless, if you really want tremendous upside, you can’t always go with the obvious. Sometimes, you have to stick your neck out. If you’re feeling cheeky as the British like to say, below are stock comeback predictions to consider.

Enphase Energy (ENPH)

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A rocky but enticing idea for stock comeback predictions, Enphase Energy (NASDAQ:ENPH) struggled mightily last year. Due to high borrowing costs as the Federal Reserve imposed a hawkish monetary policy, the broader solar energy industry struggled. That’s because the headwind was two-fold. On the consumer end, higher interest rates translated to affordability problems. For the business side, companies struggled to expand because money became “expensive.”

However, as soon as rumors hit that the Fed may lower interest rates this year, several solar-related entities became turnaround stocks. Now, an incentive may exist for consumers to consider making the switch to solar solutions. Further, Wells Fargo analysts upgraded ENPH to an “overweight” rating along with a price target of $141. That’s a decent uptick from when the announcement was made.

Overall, Wall Street analysts rate shares a consensus moderate buy. This breaks down as 15 buys, 12 holds and one sell. No, experts aren’t fully convinced. Still, a more positive fundamental backdrop could make Enphase one of the rebounding stocks of 2024.

Etsy (ETSY)

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At first glance, homemade goods and crafts retail specialist Etsy (NASDAQ:ETSY) seems a tough proposition to swallow. Recently, analysts at Goldman Sachs led by Alexandra Steiger downgraded ETSY to “neutral” from “buy.” Also, the market expert cut the price target to $80. Previously, it stood at $84. To be sure, the pessimism is understandable. At the time of the report, ETSY fell 41% in the past 52 weeks.

Still, it’s not impossible that the company could represent one of the stock comeback predictions. For one thing, you have the global e-commerce market, which may command a total market value of over $5 trillion by 2028. Of course, Etsy is only an imperceptible fraction of this enormous figure. But it just needs to grab an appropriate share of the market for shares to fly higher.

Further, ETSY may be approaching a more favorable backdrop. In 2023, the personal saving rate rose due to money becoming expensive. If money becomes cheaper due to dovish monetary policy, an incentive to spend may materialize. Analysts overall consider ETSY one of the possible rebounding stocks with a moderate buy rating.

Albemarle (ALB)

Source: IgorGolovniov/Shutterstock.com

A specialty chemicals company, Albemarle (NYSE:ALB) arguably represents one of the permanently relevant enterprises. However, that doesn’t always mean that the target security will print positive returns year after year. Case in point is ALB in 2023. It plain stunk up the field. I’d use harsher language but as I like to say, this is a family show.

But let’s be real. With the underlying electric vehicle market suffering a brutal price war, EV manufactures engaged in a competition of attrition. And if that wasn’t bad enough, broader economic headwinds meant that demand for new EVs was soft. Yeah, the prices are low but the financing costs were high. Combined with fears of recession last year along with mass layoffs, few wanted to buy big-ticket items.

Still, ALB could be a candidate for stock comeback predictions based on longer-term trends. Looking ahead, EV sector revenue could reach $623.3 billion by year’s end. And the segment may still expand at a compound annual growth rate (CAGR) of 9.82%. Analysts rate shares a moderate buy with a $177.57 price target for a reason.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare. Tweet him at @EnomotoMedia.

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