In this article, we highlight the 13 Best Beaten Down Stocks to Invest in According to Analysts.
US stock markets hit new highs in 2025 during the artificial intelligence boom. Investors largely ignored concerns about higher tariffs from the Trump administration and fears of a bubble in AI companies, allowing the rally to continue.
The S&P 500 is entering the new year after strong double-digit gains, averaging 13% growth per year over the last decade. The Nasdaq, which focuses on tech stocks, is up more than 18%, thanks to the performance of the ‘magnificent seven.’
“I think conditions remain relatively fertile for stock prices to do OK overall,” Luschini told CBS News. “The big risk is that the whole AI narrative starts to lose a little of its viscosity.”
Wall Street strategists predict strong market performance in 2026, helped by the Federal Reserve’s monetary easing. JPMorgan expects the S&P 500 to rise 13% to 15% next year, supported by corporate earnings growth.
UBS Group AG strategists believe the S&P 500 could surpass 7,500 next year, thanks to strong US earnings growth. The AI boom is also expected to push equity markets higher as more capital flows into tech stocks.
Despite overall gains, some stocks have lagged amid concerns about monetary policy, weak earnings, and economic uncertainty. While some stocks hit record highs, others have dropped to 52-week lows, losing over 30% of their value.
However, John Stoltzfus, a strategist at Oppenheimer Asset Management, has downplayed the recent declines in some stocks.
“The softening in stock prices reflected in the major indexes at present looks like something between a ‘haircut’ and a ‘trim’ rather than the beginning of a more serious period of decline,” Stoltzfus said.
With this in mind, here are some of the best beaten-down stocks to consider buying, according to analysts, as strong momentum continues into 2026.
Source: unsplash
Our Methodology
To compile the 13 best beaten down stocks to invest in according to analysts, we used Finviz to screen companies trading within 0%–10% of their 52-week lows and that were down by more than 30% year-to-date. We then selected the stocks that were the most popular among hedge funds in Q3 2025 and that analysts are bullish on currently. We have ranked the stocks in ascending order of upside potential.
Note: All data was sourced on December 22.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research shows 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 427.7% since May 2014, beating its benchmark by 264 percentage points (see more details here).
Best Beaten Down Stocks to Invest in According to Analysts
13. Snap Inc. (NYSE:SNAP)
52-Week Range: $6.90 – $13.28
Share price as of December 22: $7.60
Upside Potential: 27.94%
Year to date Loss: -33.26%
Number of Hedge Fund Holders: 50
Snap Inc. (NYSE:SNAP) is one of the best beaten down stocks to invest in according to analysts. On December 2, analysts at Guggenheim reiterated a Neutral rating and $8 price target on Snap Inc. (NYSE:SNAP).
The Neutral stance follows an analysis of the company’s Ads Manager audience reach and Apptopia download data that showed soft growth in November, hurt by the international slowdown. Global downloads tracked by Apptopia are also down in 2025 as domestic usage declines persist across data sources.
Meanwhile, Guggenheim expects Snap to deliver 474 million fourth-quarter daily active users, a three-million-user decline. It will align with management forecasts as the company faces headwinds, including the requirement for age verification on the platform. Nevertheless, the research firm is optimistic that Snap will reach 1 billion global monthly active users by the end of next year. The company delivered a 10% year-over-year increase in revenue in the third quarter to $1.51 billion. It has also inked a strategic partnership with Perplexity, expected to bring in 400 million.
Meanwhile, on December 11, Jefferies reiterated its Buy rating and $10 price target. RBC Capital analyst Brad Erickson, on the other hand, reiterated a Hold rating on the stock on December 18 and maintained a $10 price target.
Snap Inc. (NYSE:SNAP) is a social media and camera company best known for its Snapchat app, which focuses on visual communication through disappearing messages, AR Lenses, Stories, Spotlight (short videos), and Snap Map, and generates revenue primarily from business ads.
12. PayPal Holdings, Inc. (NASDAQ:PYPL)
52-Week Range: $55.85 – $93.25
Share price as of December 22: $59.86
Upside Potential: 30.19%
Year to date Loss: -30.17%
Number of Hedge Fund Holders: 86
PayPal Holdings Inc. (NASDAQ:PYPL) is one of the best beaten down stocks to invest in according to analysts. On December 15, PayPal Holdings Inc. (NASDAQ:PYPL) affirmed plans to deepen its presence in the US financial system. The company has applied to establish a Bank in the US as it rushes to capitalize on a friendly regulatory environment.
The filing with the Utah Department of Financial Institutions and the Federal Deposit Insurance Corporation is part of an effort to form an industrial loan company. The filling comes as FinTechs and crypto companies push to expand their businesses.
PayPal has set its sights on strengthening its lending business to small businesses in the US, having provided $30 billion in loans and capital since 2013. The effort will also allow it to reduce reliance on third parties. Additionally, it plans to offer interest-bearing savings accounts to customers.
“Securing capital remains a significant hurdle for small businesses striving to grow and scale,” said PayPal CEO Alex Chriss. “Establishing PayPal Bank will strengthen our business and improve our efficiency, enabling us to better support small business growth and economic opportunities across the U.S.”
Meanwhile, research firm Bernstein SocGen has reiterated a Market Perform rating on PayPal with a $76 price target on December 17. The positive stance comes amid expectations that obtaining a banking license will enable the company to expand its lending operations and reduce its reliance on partner banks.
PayPal Holdings, Inc. (NASDAQ:PYPL) is a global technology platform enabling digital payments for consumers and merchants. It acts as an electronic alternative to cash, checks, and cards for online/offline purchases, money transfers (P2P), and managing finances through its digital wallet.
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