Top Discounted Stocks to Consider for Future Growth

Discover Incredible Stock Opportunities

As the new year unfolds, investors are keen on setting up their portfolios for success in the coming months. Focusing on undervalued stocks, or those trading at a discount, is a strategic approach that can lead to significant gains. This article explores compelling discounted stock picks that savvy investors should consider, particularly in sectors like technology and consumer staples.

1. Adobe: A Technology Leader at a Discount

One of the standout options in the tech sector is Adobe (NASDAQ: ADBE). Recently, Adobe has undergone a transformative shift to a subscription-based model for its software products, which has proven to be beneficial. With this arrangement, many users happily commit to a 12-month contract. This not only shows customer loyalty but also positions Adobe as a strong player with predictable revenue streams.

Despite trading at approximately 66% of its 52-week high, analysts see a bright horizon for Adobe, with a consensus price target of $575.85 per share. This implies a notable upside potential of around 37.4%, making it a stock worth considering for your portfolio.

2. Advanced Micro Devices: A Compelling Semiconductor Bet

In the semiconductor space, Advanced Micro Devices (NASDAQ: AMD) stands out as another attractive pick. The semiconductor industry has been dominated by NVIDIA (NASDAQ: NVDA) recently, particularly due to the surge in artificial intelligence developments. While NVIDIA’s stock is trading near its 52-week high, AMD presents a contrasting opportunity for investors.

Currently, AMD is trading at about 54% of its 52-week high, suggesting it has room for significant growth. The consensus price target for AMD indicates a possible run-up of 55% from today’s levels. Given the ongoing advancements in semiconductor technology, AMD could be an essential addition for investors looking to capitalize on the tech sector's growth.

3. Hershey: Sweet Investment Potential

Another sector that presents an excellent opportunity is consumer staples, with Hershey (NYSE: HSY) being a notable example. Hershey's stock has dropped to around 77% of its 52-week high, opening a door for investors to benefit from a favorable risk-to-reward setup. The company boasts a solid return on invested capital (ROIC) of up to 23%, a crucial factor in wealth compounding.

Institutional investors, including State Street, have shown confidence in Hershey by increasing their stake by 5.8%. Forecasts from analysts suggest that earnings per share (EPS) could rise significantly over the next 12 months, enhancing Hershey's attractiveness as a value play moving forward.

Frequently Asked Questions

What makes discounted stocks a good investment?

Discounted stocks offer a chance for greater returns as they can rebound to higher values as market conditions improve or as the company performs better.

Which stocks are recommended for 2025?

Adobe, Advanced Micro Devices, and Hershey are highly recommended due to their current price discounts and growth potential within their respactive industries.

How do subscription models benefit companies like Adobe?

Subscription models create steady revenue streams and enhance customer retention, leading to predictable financial performance.

Why is AMD considered a compelling investment?

AMD is viewed as a compelling investment due to its current price position compared to its growth potential in the semiconductor market.

What should investors consider for consumer staples like Hershey?

Investors should consider Hershey's strong ROIC and its proven track record in delivering consistent returns, especially when prices dip.

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