In this article, we will look at the 10 Oversold Growth Stocks to Invest In Now.
On May 18, Jeffrey Solomon, vice chair and special advisor at TD Bank U.S., appeared on CNBC’s ‘Squawk on the Street’ to talk about how the Iran war and energy prices are driving markets, his economic outlook, and more.
According to him, the number one thing driving the markets right now is what is going to happen in Iran, as well as the circumstances surrounding energy prices. He thinks that outweighs all other factors affecting the market at the moment, and added that people are likely to trade based on the news and what is happening on a daily basis.
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He made the case that this ends faster than anybody is anticipating, just because there is an economic incentive for both sides to kind of reach this. That, he believes, is probably one of the things that hasn’t been talked about in the Trump XI conference, that both sides have a lot of vested interest in bringing an off-ramp pretty quickly, because there are economic implications to both China and the United States, as well as the global economy.
With these broader market trends in view, let’s look at the best oversold growth stocks to invest in now.
Our Methodology
We sifted through the Finviz stock screener to compile a list of stocks that have declined by at least 25% over the past six months but for which analysts see potential to recover, and which have a track record of delivering earnings growth and have grown their EPS by at least 20% over the past 3 years. We limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment. These stocks are also popular among analysts and elite hedge funds. We sourced the hedge fund sentiment data from Insider Monkey’s database, and the stocks are ranked in ascending order of their hedge fund sentiment as of Q4 2025.
Note: All data was recorded on March 18.
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 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
10 Oversold Growth Stocks to Invest In Now
10. The Beachbody Company, Inc. (NASDAQ:BODI)
Number of Hedge Fund Holders: 4
The Beachbody Company, Inc. (NASDAQ:BODI) is one of the best oversold growth stocks to invest in now. Roth Capital lifted the price target on The Beachbody Company, Inc. (NASDAQ:BODI) to $13 from $10 on May 13, maintaining a Neutral rating on the shares. The rating update came after the company reported its fiscal Q1 results, telling investors in a research note that sequential growth in the company’s legacy businesses remains negative. It further stated that while various retail launches are planned, The Beachbody Company’s product velocity is uncertain.
The Beachbody Company, Inc. also received a rating update from Noble Capital the same day, with the firm lifting the price target on the stock to $22 from $15 while maintaining an Outperform rating on the shares. The update came after the company’s fiscal Q1 results surpassed expectations despite continued legacy business runoff.
For reference, The Beachbody Company, Inc. reported total revenue of $54.3 million in fiscal Q1 2026, compared to $72.4 million in the prior year period. Digital revenue was $33.6 million compared to $42.9 million in the prior year period, while digital subscriptions totaled 0.81 million in the quarter.
The Beachbody Company, Inc. is a health and wellness company that offers holistic health and wellness platforms. Its product offerings include nutritional products, digital subscriptions, and connected fitness products.
9. Velo3D, Inc. (NASDAQ:VELO)
Number of Hedge Fund Holders: 5
Velo3D, Inc. (NASDAQ:VELO) is one of the best oversold growth stocks to invest in now. Lake Street lifted the price target on Velo3D, Inc. (NASDAQ:VELO) to $20 from $18 on May 13, reaffirming a Buy rating on the shares. The rating update came after the company released its fiscal Q1 2026 financial results on May 12, with the firm contending that a “strong print should give investors confidence in the expected ramp this year”.
In its financial results for the quarter, Velo3D, Inc. reported a revenue of $13.8 million, up 48% year-over-year, with a gross margin of 17.2%. Management reported that the 3D Printer and parts revenue rose 60% compared to the prior year period, attributed to an increase in the average selling price, number of systems sold, and an increase in RPS revenues. The company also reaffirmed its outlook for 2026 revenue between $60 million and $70 million and to turn EBITDA positive in the second half of 2026.
Velo3D, Inc. is a technology company involved in the development and manufacturing of metal laser sintering printing machines for 3D printing. The company’s products include assure system, Flow Software, Sapphire Printer, & sapphire XC.
8. Biodesix, Inc. (NASDAQ:BDSX)
Number of Hedge Fund Holders: 6
Biodesix, Inc. (NASDAQ:BDSX) is one of the best oversold growth stocks to invest in now. Canaccord lifted the price target on Biodesix, Inc. (NASDAQ:BDSX) to $22 from $20 on May 5, reiterating a Buy rating on the shares. The firm stated that the price target increase is driven primarily by raised revenue assumptions and operating margin expansion in its 10-year DCF model.
The rating update came after Biodesix, Inc. reported business and financial results for fiscal Q1 2026 on May 4, reporting that Diagnostic Testing revenue reached $22.3 million in the quarter, representing 37% year-over-year growth. This was attributed to a 29% increase in test volumes to 17,800 and a higher average revenue per test, while the improvement in average revenue per test was primarily driven by expanded payer coverage and enhancements to revenue cycle management.
Biodesix, Inc. further reported that total revenue for fiscal Q1 2026 was $25.6 million, up 42% over the respective prior-year comparable period, with an 84% gross margin.
Biodesix, Inc. is a provider of blood-based diagnostics services for patients with lung disease. The firm offers GeneStrat and VeriStrat, along with six other diagnostic tests, including: Nodify XL2, Nodify CDT, GeneStrat, VeriStrat, Bio-Rad SARS-CoV-2 ddPCR test, and the Platelia SARS-CoV-2 test.
7. RideNow Group, Inc. (NASDAQ:RDNW)
Number of Hedge Fund Holders: 8
RideNow Group, Inc. (NASDAQ:RDNW) is one of the best oversold growth stocks to invest in now. Baird lifted the price target on RideNow Group, Inc. (NASDAQ:RDNW) to $9 from $7 on May 15, reiterating a Neutral rating on the shares. The firm updated its model as robust same-store sales fuel its upside.
The rating update came after the company reported its financial results for fiscal Q1 2026 on May 14, reporting that Powersports revenue rose 6.4% to reach $260.4 million, which represents an increase of $15.7 million. Powersports Revenue was up 13.1% on a same-store sales basis, which was driven by a 16.3% increase in unit sales. The company further reported that the Powersports gross profit was $71.6 million, up 8.3%, while selling, general & administrative expense was $62.1 million, or 86.7% of total Company gross profit, compared to $61.1 million, or 90.9% of gross profit in the prior year period.
RideNow Group, Inc. provides motor vehicle dealer and e-commerce platforms. The company’s operations are divided into the Powersports Dealership Group and Vehicle Transportation Services segments.
6. Forum Energy Technologies, Inc. (NYSE:FET)
Number of Hedge Fund Holders: 15
Forum Energy Technologies, Inc. (NYSE:FET) is one of the best oversold growth stocks to invest in now. In its financial results for fiscal Q1 2026 announced on April 30, Forum Energy Technologies, Inc. (NYSE:FET) reported revenue of $209 million and net income of $4 million or $0.39 per diluted share. Management stated that adjusting for restructuring costs, net income was $6 million or approximately $0.47 per diluted share, while orders reached $221 million with a book-to-bill ratio of 106%. Adjusted EBITDA for the quarter was $23 million, with the company reporting that revenue and adjusted EBITDA rose 8% and 14% year-over-year. It received solid orders for its differentiated products, raising its backlog 44% compared to the first quarter of 2025.
Forum Energy Technologies, Inc. also reported that while the conflict in the Middle East has resulted in considerable hardships for the region, the company has experienced minimal impact on its financial results and anticipates increased commodity prices and elevated upstream spending in the longer term to drive demand for its products and technology.
Forum Energy Technologies, Inc. is involved in the design, manufacturing, and distribution of products to the oil and natural gas industry. The company’s operations are divided into the following segments: Drilling and Completions and Artificial Lift and Downhole.
5. PDF Solutions, Inc. (NASDAQ:PDFS)
Number of Hedge Fund Holders: 15
PDF Solutions, Inc. (NASDAQ:PDFS) is one of the best oversold growth stocks to invest in now. Northland lifted the price target on PDF Solutions, Inc. (NASDAQ:PDFS) to $50 from $33 on May 8, reiterating an Outperform rating on the shares following “a strong quarter” and maintaining a full-year revenue guidance of up 20%.
The rating update came after PDF Solutions, Inc. announced financial results for fiscal Q1 2026 on May 7, reporting quarterly total revenues of $60.1 million, up 26% over last year’s comparable quarter. It further reported GAAP gross margin of 72% and non-GAAP gross margin of 76%, with GAAP operating margin of 10% and non-GAAP operating margin of 25%.
Management also stated that GAAP net income for the quarter was $4.8 million, or $0.12 per diluted share, compared to net loss of $48 thousand, or $(0.00) per diluted share, for fiscal Q4 of 2025, and net loss of $3.0 million, or $(0.08) per diluted share, for fiscal Q1 2025.
PDF Solutions, Inc. provides an end-to-end analytics platform empowering engineers and data scientists across the semiconductor ecosystem and data analytics for yield enhancement and process-design optimization. Its products, platforms, and services include proprietary software, electrical measurement hardware tools, physical intellectual property for integrated circuit designs, proven methodologies, and professional services.
4. Eton Pharmaceuticals, Inc. (NASDAQ:ETON)
Number of Hedge Fund Holders: 18
Eton Pharmaceuticals, Inc. (NASDAQ:ETON) is one of the best oversold growth stocks to invest in now. H.C. Wainwright lifted the price target on Eton Pharmaceuticals, Inc. (NASDAQ:ETON) to $57 from $52 on May 15, reaffirming a Buy rating on the shares and citing the company’s elevated fiscal 2026 revenue guidance and confidence in its growth strategy for the target bump. The firm further told investors in a research note that the company’s stated long-term goals could be achievable, given its execution to date.
The rating update came after Eton Pharmaceuticals, Inc. reported its fiscal Q1 2026 results on May 14, reporting product sales of $24.3 million for the quarter, reflecting a 73% growth over Q1 2025. It also raised its full-year revenue guidance, and now anticipates 2026 revenue to surpass $120 million, up from previous guidance of $110 million. The company further reported that fiscal Q1 2026 fully diluted GAAP EPS was $0.05, non-GAAP fully diluted EPS was $0.14, and adjusted EBITDA reached $5.7 million. Eton Pharmaceuticals, Inc. also received FDA approval for and launched DESMODA™, while also acquiring and relaunching HEMANGEOL®.
Eton Pharmaceuticals, Inc. is a pharmaceutical company that develops and sells treatments for rare diseases. The company focuses on bringing therapies to patients with limited treatment options.
3. Cerus Corporation (NASDAQ:CERS)
Number of Hedge Fund Holders: 21
Cerus Corporation (NASDAQ:CERS) is one of the best oversold growth stocks to invest in now. BTIG upgraded Cerus Corporation (NASDAQ:CERS) to Buy from Neutral on May 1, reiterating a $4 price target. The rating update came after the company announced its financial results for fiscal Q1 2026, with total revenue for the quarter reaching $59.9 million, up 23% compared to the prior year period. Product revenue for fiscal Q1 2026 reached $53.7 million, reflecting a 24% growth over the prior year period.
Cerus Corporation raised its full-year product revenue guidance range to $227 million – $231 million, reflecting 10% to 12% year-over-year increase. Management attributed the strong start to 2026 to strength across the company’s business, in particular due to rising demand for its INTERCEPT Fibrinogen Complex. Cerus Corporation also announced a meaningful catalyst path in 2026, spanning anticipated regulatory, clinical, and pipeline milestones, which includes ongoing INTERCEPT RBC regulatory review in Europe, the Phase 3 RedeS readout in the U.S., and the planned U.S. PMA submission for its new INT200 illumination device.
Cerus Corporation is involved in the research, development, and manufacturing of biomedical and surgical products. The company produces blood systems for platelets and plasma, operates through the Blood Safety segment, and markets products under the INTERCEPT brand.
2. ASML Holding N.V. (NASDAQ:ASML)
Number of Hedge Fund Holders: 101
ASML Holding N.V. (NASDAQ:ASML) is one of the best oversold growth stocks to invest in now. ASML Holding N.V. (NASDAQ:ASML) announced on May 16 the signing of a Memorandum of Understanding (MoU) with Tata Electronics for the advancement of the semiconductor manufacturing ecosystem in India. Tata Electronics is a leading name in India’s electronics and semiconductor manufacturing sector. The company reported that the partnership would allow ASML Holding N.V. to enable the establishment and successful ramp of Tata Electronics’ upcoming 300 mm (12 inch) semiconductor fab in Dholera, Gujarat. The collaboration marks a significant step in the intensifying strategic collaboration between India and the Netherlands in the field of critical technologies, such as semiconductor technology.
The company further reported that the collaboration would focus on the deployment of ASML Holding N.V.’s holistic suite of advanced lithography tools and solutions for the Dholera fab.
Separately, in its financial results for fiscal Q1 2026, ASML Holding N.V. reported total net sales of €8.8 billion, gross margin of 53.0%, and net income of €2.8 billion. The company anticipates Q2 2026 total net sales to be between €8.4 billion and €9.0 billion, and a gross margin between 51% and 52%.
ASML Holding N.V. is involved in the development, production, marketing, sales, upgrading, and servicing of advanced semiconductor equipment systems. It includes lithography, metrology, and inspection systems.
1. Lam Research Corporation (NASDAQ:LRCX)
Number of Hedge Fund Holders: 104
Lam Research Corporation (NASDAQ:LRCX) is one of the best oversold growth stocks to invest in now. Morgan Stanley upgraded Lam Research Corporation (NASDAQ:LRCX) to Overweight from Equal Weight on May 18, adjusting the price target on the stock to $331 from $293. The firm told investors in a research note that the magnitude of Morgan Stanley’s DRAM wafer fab equipment revisions has narrowed, and the firm is now more positive on NAND wafer fab equipment revisions from here. It also cited confidence in the company’s 2027 share gains for the upgrade. The firm coupled the upgrade with a downgrade of Applied Materials (AMAT).
In a separate development, RBC Capital lifted the price target on Lam Research Corporation to $310 from $290 on April 23, maintaining an Outperform rating on the shares and telling investors in a research note that the company delivered a solid beat and raise. This was driven primarily by market share gains and GenAI demand, while DRAM memory was particularly strong in the quarter, and the NAND outlook is also improving.
Lam Research Corporation designs, manufactures, markets, refurbishes, and provides semiconductor processing equipment used in the fabrication of integrated circuits. The company’s operations are divided into the following geographical segments: the United States, China, Europe, Japan, Korea, Southeast Asia, and Taiwan.
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