In this article, we will discuss the 8 Undervalued Stocks with Huge Upside Potential.
On April 6, Fundstrat’s Tom Lee joined ‘Squawk Box’ on CNBC to discuss how the Iran war is affecting markets and the state of the US economy. Lee acknowledged that the war is lasting longer than he initially anticipated, forcing a delay in his predicted resolution. However, based on an analysis of the seven major war events in history, he noted that markets typically bottom within the first 10% of a war’s duration. He cited World War II as an example, where the market bottomed five months into a five-year conflict. Consequently, he believes that 90% to 95% of the market’s weakness is likely over, making the current risk-reward profile attractive for stocks.
Lee addressed the dilemma facing investors who sold into the March decline and noted that the market is only slightly lower than where they likely exited. He encouraged those in cash to look past the initial crisis toward the opportunities on the other side. He described the market as spring-loaded for an explosive recovery if a definitive peace agreement is reached, especially since wartime policy and the path of the conflict currently serve as bigger market drivers than the central bank. He noted that the economy is supported by defense spending and is performing well in sectors like oil. Despite risks, Lee maintained his year-end S&P 500 target of 7,700. He pointed to a recent positive jobs report as a factor that alleviated fears of a weak labor market or recession.
Our Methodology
We used screeners to identify stocks that are trading below a forward P/E of 15 and had an average upside potential of at least 30%. We then 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.
Note: All data was sourced on April 8.
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).
8 Undervalued Stocks with Huge Upside Potential
8. NXP Semiconductors (NASDAQ:NXPI)
Average Upside Potential: 33.25%
NXP Semiconductors (NASDAQ:NXPI) is one of the undervalued stocks with huge upside potential. On March 9, NXP Semiconductors announced the i.MX 93W applications processor, a new addition to the i.MX 93 family designed to accelerate physical AI deployment. This SoC is the industry’s first to integrate a dedicated AI NPU with secure tri-radio wireless connectivity in a single package. By combining these features, the i.MX 93W allows manufacturers to replace up to 60 discrete components, reducing design complexity, board area, and system-level costs for edge devices.
The processor features a dual-core Arm Cortex-A55 and an Arm Ethos NPU capable of up to 1.8 eTOPs, enabling AI agents to collaborate locally with low latency in environments like smart buildings and healthcare. Its integrated IW610 tri-radio supports Wi-Fi 6, Bluetooth Low Energy, and 802.15.4 protocols, including Matter and Thread.
Security is a core component of the i.MX 93W, which includes an EdgeLock Secure Enclave to meet regulatory standards like the European Cyber Resilience Act. This hardware root of trust supports critical functions such as secure boot and device attestation, further supported by NXP’s EdgeLock 2GO key management services. NXP Semiconductors expects to begin sampling the i.MX 93W in H2 2026, targeting applications across industrial gateways, smart home hubs, and energy infrastructure monitors.
NXP Semiconductors is a global semiconductor company that offers products like microcontrollers, application processors, wireless connectivity solutions, and security controllers for applications in various industries.
7. NRG Energy Inc. (NYSE:NRG)
Average Upside Potential: 33.28%
NRG Energy Inc. (NYSE:NRG) is one of the undervalued stocks with huge upside potential. On March 4, NRG Energy announced the appointment of Caroline Golin, Ph.D., as Chief Growth and Policy Officer. In this newly created role, Dr. Golin will oversee the strategic execution of business initiatives aimed at addressing rising energy demand, specifically focusing on data center opportunities and residential virtual power plant programs. Additionally, she is tasked with leading the company’s Government and Regulatory Affairs functions to ensure reliability and affordability for customers.
Dr. Golin joins NRG with more than 20 years of experience in market development and energy strategy. She most recently served as the Founder and CEO of Envision Energy Advisors, where she managed complex challenges in grid planning and procurement strategy. Previously, she was the Global Head of Energy Market Development and Innovation at Google, where she co-created the company’s initiative to operate entirely on carbon-free energy by 2030 and managed strategy for its digital infrastructure needs.
Dr. Golin, who holds a Master’s degree and a Ph.D. from the Georgia Institute of Technology, expressed her enthusiasm for joining the company at an industry inflection point. She noted that NRG Energy Inc. is well-positioned to leverage its market-leading platform to deliver innovative solutions and capture future growth as demand increases.
NRG Energy Inc. is a utilities company that specializes in energy and home services through its Texas, East, West/Other, Vivint Smart Home, and Corporate Activities segments. The company provides its services to a diverse range of customers, from data centers to wholesale.
6. Expand Energy Corporation (NASDAQ:EXE)
Average Upside Potential: 33.42%
Expand Energy Corporation (NASDAQ:EXE) is one of the undervalued stocks with huge upside potential. On April 6, Expand Energy Corporation announced the appointment of Marcel Teunissen as Chief Financial Officer. Teunissen joins the company from Parkland Corporation, where he most recently served as President of North America and previously held the role of Chief Financial Officer from 2020 to 2024.
During his tenure at Parkland, he directed financial strategy and capital markets, supporting the organization’s growth through large-scale business transformations and acquisitions. Before his time at Parkland, Teunissen spent over 20 years with Shell plc in various executive and senior finance roles. His experience at Shell included serving as Vice President of Finance for Integrated Gas Ventures and Executive Vice President of Finance for Global Integrated Gas and New Energies in the Netherlands.
Teunissen noted that Expand Energy Corporation is well-positioned to capitalize on surging natural gas demand driven by AI power generation and industrial needs. He expressed his commitment to advancing a commercial approach that enhances returns and resilience as he joins North America’s largest natural gas producer.
Expand Energy Corporation is an oil & gas E&P company that deals in oil, natural gas, and natural gas liquids. The company was formerly known as Chesapeake Energy Corporation.
5. Check Point Software Technologies Ltd. (NASDAQ:CHKP)
Average Upside Potential: 34.77%
Check Point Software Technologies Ltd. (NASDAQ:CHKP) is one of the undervalued stocks with huge upside potential. On March 23, Check Point Software announced the launch of the Check Point AI Defense Plane. This unified security control plane is designed to help enterprises govern and secure the agentic era, where AI systems transition from content generators to autonomous actors capable of accessing data and triggering workflows.
Built on Check Point’s AI Security platform, the solution integrates technologies from ThreatCloud AI and recent acquisitions of Lakera and Cyata to provide discovery, governance, and runtime control across the AI execution lifecycle. The platform’s core is an AI-native security engine that delivers adaptive protection in under 50 milliseconds across more than 100 languages.
Unlike traditional guardrails that focus solely on model safety, the AI Defense Plane secures AI behavior within live production environments. It features 3 primary modules: Workforce AI Security for employee usage governance, AI Application & Agent Security for managing permissions & data access of embedded systems, and AI Red Teaming for continuous adversarial testing of agent workflows & reasoning paths. Check Point Software Technologies Ltd. confirmed that both the Workforce and Application modules are available immediately, while the Red Teaming module has moved into limited release.
Check Point Software Technologies Ltd. is a technology company that specializes in IT security. The company offers multilevel security for cloud, network, mobile, endpoints, and IoT, alongside technical support, professional services, and product certification or training.
4. Capital One Financial Corporation (NYSE:COF)
Average Upside Potential: 43.53%
Capital One Financial Corporation (NYSE:COF) is one of the undervalued stocks with huge upside potential. On March 23, Capital One Software announced expanded capabilities for its Databolt platform at the RSAC 2026 Conference. These new features are designed to address the complexities of enterprise data security by automatically securing sensitive elements within unstructured data, such as PDFs, emails, and transcripts.
By identifying personally identifiable information and applying semantic-preserving protection like tokenization, Databolt aims to transform previously unusable dark data into secure assets for AI and analytics workflows. The expansion includes several upcoming features intended to establish a secure-by-default standard for the entire data lifecycle.
Key updates include a 100% self-hosted deployment option for regulated businesses, enhanced protection policies for granular access control, and a centralized token analytics dashboard for system visibility. Additionally, the platform introduced logical segmentation through Domains and extensive data catalog connectivity to help organizations integrate and manage metadata across complex data stacks more efficiently.
Capital One Financial Corporation is a financial services company that provides various financial products and services through three segments: Credit Card, Consumer Banking, and Commercial Banking.
3. Barrick Mining Corporation (NYSE:B)
Average Upside Potential: 45.00%
Barrick Mining Corporation (NYSE:B) is one of the undervalued stocks with huge upside potential. On April 2, Barrick Mining provided an update regarding the status of the Reko Diq project. This followed an earlier announcement on February 5, in which the company stated it was reviewing the project due to an escalation of security risks and incidents in the region. While Barrick maintains its belief in the long-term value of the asset, the company has decided to slow development activity and extend its comprehensive review until mid-2027 to assess the evolving security landscape, capital requirements, and project scope.
As a result of this decision, Reko Diq will remain under active management but with a reduced capital spend. Despite the slowdown in development, Barrick Mining intends to continue honoring and investing in its existing community and social programs within the country. The company noted that the development of Phase 1 was approved under these adjusted parameters as it continues to monitor the situation in consultation with its joint venture partners.
Barrick Mining Corporation anticipates that the previously disclosed capital budget and timeline for the project could see significant increases. The original estimates for Phase 1 were between $5.6 billion and $6.0 billion, while Phase 2 was estimated between $3.3 billion and $3.6 billion, with first production targeted for the end of 2028. A further update to the market is expected following the conclusion of the extended review in mid-2027.
Barrick Mining Corporation is a Canadian mineral properties company that explores for gold, copper, silver, and energy materials. The company was founded in 1983.
2. CGI Inc. (NYSE:GIB)
Average Upside Potential: 48.52%
CGI Inc. (NYSE:GIB) is one of the undervalued stocks with huge upside potential. On April 2, CGI entered into a multi-year strategic collaboration agreement with Amazon Web Services/AWS to drive AI innovation and digital transformation throughout the US public sector. This partnership aims to provide scalable, mission-critical solutions for government, education, nonprofit, and healthcare organizations.
By combining CGI’s professional services expertise with AWS’s cloud capabilities, the alliance focuses on delivering advancements in cybersecurity, fraud prevention, and operational decision support. The collaboration outlines several key objectives, such as the acceleration of trusted AI adoption and the strengthening of Zero Trust cybersecurity architectures.
The two companies will work to improve data interoperability and accessibility across agencies, modernize legacy government systems, and enhance citizen-focused digital services. To support these goals, the agreement includes dedicated investments in cloud and AI training and certification programs for CGI professionals to deepen their technical expertise. As an AWS Premier Tier Services partner, CGI Inc. will use its global network and specialized programs, such as ’12 Weeks to AI’, to help clients prioritize use cases and build machine-learning models.
CGI Inc. is an IT company that offers business process services internationally. The company specifically provides end-to-end services & solutions, as well as infrastructure services.
1. Ares Management Corporation (NYSE:ARES)
Average Upside Potential: 57.47%
Ares Management Corporation (NYSE:ARES) is one of the undervalued stocks with huge upside potential. On April 2, Ares Management successfully raised ~$5.4 billion in aggregate capital to support its value-add real estate strategies in the US and Europe. This total includes equity commitments and transaction vehicles for two specific funds: Ares US Real Estate Fund XI (US XI) and Ares European Property Enhancement Partners IV (EPEP IV).
US XI reached its increased hard cap of $3.1 billion, contributing to a total of $3.5 billion for the US strategy, while EPEP IV secured ~$1.9 billion for European opportunities. The capital will be utilized by Ares Real Estate to target high-conviction ‘New Economy’ sectors such as logistics, multifamily, and self-storage. By using global insights alongside regional teams, the firm aims to acquire high-quality assets in supply-constrained markets that benefit from long-term structural demand.
At the time of the announcement, both US XI and EPEP IV had already deployed or identified ~$1.1 billion each in initial investments. As of December 31, 2025, Ares Real Estate managed ~$114 billion in assets with a global team of over 740 professionals. This scaled platform continues to execute diverse equity and debt strategies across the Americas, Europe, and the Asia-Pacific region.
Ares Management Corporation is an asset management company that invests in healthcare, services, energy, industrials, and consumer sectors. The firm targets investments of $1 to $500 million in companies with $10 to $250 million in EBITDA and $10 to $100 million in debt.
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