These 3 Stocks are Poised to Rebound in 2022
Although the major market indices like the S&P 500 are trading at all-time highs to end the year, there are plenty of stocks that faced significant selling pressure in 2021 that have yet to rebound. Whether it’s businesses that were hurt by the pandemic, growth stocks that have taken a hit due to upcoming interest rate hikes, or companies in the payments space that have suffered from negative sentiment, there are plenty of companies out there that are still well off of their 52-week highs.
Some of these beaten-up stocks could be in for a comeback as we head into 2022, which means it’s not a bad idea to start looking at adding shares. It’s also important to remember that The January Effect could lead to money rotating out of past winners and into areas of the market that offer more upside potential. That’s why we’ve put together the following list of 3 comeback stocks to buy for 2022. Keep reading below to learn more.
Disney stock has certainly been a major disappointment in 2021, as the company’s share price has taken a hit due to new variants of the COVID-19 virus and a slowdown in Disney+ subscriber growth. With that said, it’s still a great blue-chip name to consider owning for the long-term and a company that could be a big winner next year. Investors should consider the fact that the winter tends to be the peak for COVID cases during the year, which means that people could be heading back to the company’s iconic theme parks and cruise ships in droves when the summer rolls around thanks to pent up demand.
There’s also a lot to like about Disney+ and its growth prospects, as the company is certainly going to improve its content offerings and focus on international expansion after the big miss in subscribers last quarter. Keep in mind that Disney owns some of the largest media network brands in the world, including ESPN, ABC, FOX, and more, along with incredibly strong Disney brand franchises including Pixar, the Marvel Universe, and Lucasfilm. These franchises and brands should help the company dominate the streaming entertainment industry for years to come by attracting both young and adult viewers.
For a few months of 2021, Upstart Holdings stock was unstoppable. The fintech company’s fantastic earnings report back in August ignited a rally that sent shares to the stratosphere, yet Upstart has since given back that entire post-earnings move. Growth-oriented investors should still be interested in adding exposure to this disruptive company, and the stock could be gearing up for a comeback in the coming months. Upstart is unique in that it is changing the consumer-financing industry with its artificial intelligence lending platform.
The company is helping consumers get access to loans at rates 10% lower than traditional lenders while also making it easier for banks to choose loan applicants with a lower chance of default. Upstart might just end up making the traditional FICO score obsolete, and the company’s growth has certainly been impressive. Although the stock price has taken a beating over the last few months, it’s worth noting that the company still posted total revenue of $228 million, up 250% year-over-year, and originated 362,780 loans for bank partners, up 244% year-over-year in Q3. Another sign that this company is heading in the right direction is the fact that Upstart delivered Adjusted EBITDA of $59.1 million in Q3, up from $15.5 million a year before.
Global payment processors like Mastercard have had their ups and downs over the past year, with renewed fears about the impacts of the pandemic on consumer spending and international travel continuing to hold shares down. That could certainly change in 2022, which means Mastercard is a fantastic comeback candidate to consider adding shares of now. It’s a high-quality business that is going to benefit from long-term secular growth trends for many years to come, as the digital payments industry still has plenty of room to grow in both the U.S. and in international markets.
As the second-largest payment processor in the world, an ongoing rebound in spending volumes should lead to strong earnings over the next few quarters. Mastercard is already showing signs of a recovery in cross-border transactions, and the company recently saw its gross dollar volume rose by 20% year-over-year to reach $2.0 trillion. Mastercard also recently announced that holiday retail sales excluding automotive increased 8.5% year-over-year this holiday season, another positive sign that the company could put up big numbers in 2022.