3 Consumer Stocks Set for a Comeback in 2026

2025 was not a great year for many consumer stocks. Top stocks in the industry, such as Amazon or Costco, significantly underperformed the S&P 500 (SNPINDEX: ^GSPC), and many others experienced considerable declines.

The silver lining in such situations is that it leads to buying opportunities for investors wanting to put some cash to work. Knowing that, investors may have a unique opportunity in these three consumer stocks.

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1. Target

Over the last few years, Target (NYSE: TGT) stock has become a laggard in the retail sector. Its troubles started when it purchased too much inventory during the supply chain crunch earlier in the decade, an issue it never fully resolved. Additionally, it involved itself in, and later pulled back from, some political activities.

Those moves alienated both right-leaning and left-leaning shoppers as a result. Furthermore, the stock sold off further when Target announced its COO, Michael Fiddelke, would become the new CEO in February, a likely sign of continuing frustration with the company's management team.

Amid such conditions, investors should not expect an immediate turnaround. Nonetheless, with a P/E ratio of 12, it is likely the company's challenges are priced into the stock.

Moreover, after years of declines, analysts expect revenue growth to return in 2026 as Target redesigns stores, updates its product mix, and invests in supply chain improvements.

Furthermore, Target is a Dividend King, with 54 straight years of payout hikes. That payout currently offers a dividend yield of 4.6%, far above the S&P 500's 1.1% average. Since free cash flow remains well above dividend costs, it is unlikely to alienate investors by abandoning its Dividend King status.

Ultimately, with investors able to buy shares at a low valuation and collect a large, sustainable dividend, Target stock's long-awaited recovery could finally begin soon.

2. Sea Limited

As a Singapore-based consumer and tech conglomerate, Sea Limited (NYSE: SE) may not be familiar to most American investors. It operates in Southeast Asia, a fast-growing region often overshadowed by its larger neighbors, China and India.

Fortunately, that factor has helped carve out a lucrative niche for its three businesses. The largest by revenue is Shopee, which is the e-commerce leader in Southeast Asia and also operates in Brazil. Its Monee segment is a leading fintech company in its region, while the gaming segment, Garena, is likely best known for its mobile game Free Fire.

However, the stock is down by about 35% since its September high. Concerns about competition from MercadoLibre in Brazil and from Grab Holdings in Southeast Asia have weighed on the stock's performance.

Still, investors might have turned negative too quickly. Analysts forecast 33% revenue growth for the year, and even if annual revenue growth slows to 24% in 2026, the rapid expansion should continue.

Also, while the 55 P/E ratio may seem high, its forward P/E ratio of 37 may appear reasonable when compared to the aforementioned revenue growth.

Ultimately, considering its valuation and the growth potential of its three businesses, the stock is probably in a strong position to resume its growth in the coming year.

3. The Trade Desk

The Trade Desk (NASDAQ: TTD) started 2025 strong. The buy-side platform for digital advertisers became increasingly popular as they turned to this platform to place and purchase ads across various formats. Unlike Amazon or Alphabet, The Trade Desk does not operate an ad platform, and that neutrality makes it easier to find the right audience for a given ad.

However, the company missed its own revenue estimates in the fourth quarter of 2024, bringing about a huge sell-off in the stock. More recently, The Trade Desk has dealt with increasing worries about competing with large advertisers, such as Amazon, which have also weighed on the company. Additionally, with artificial intelligence (AI) engines bypassing digital ad platforms, the industry faces additional uncertainty.

Nonetheless, for all the concerns, the company has returned consistent performance financially. Analysts forecast 18% revenue growth for 2025, and with revenue growing at 20% in the first nine months of 2025, it should not surprise investors if it defies analyst expectations.

Investors should also remember that the stock has fallen by more than two-thirds, taking the stock price to levels it last saw in 2020.

Admittedly, The Trade Desk stock was likely overvalued a year ago, but that does not seem to be the case today. Its trailing P/E is 43, down from the 200 level in late 2024. Also, with a forward P/E ratio of 21, the stock appears oversold, which could mean that any good news in 2026 could help spark a significant rebound.

Will Healy has positions in MercadoLibre, Sea Limited, Target, and The Trade Desk. The Motley Fool has positions in and recommends Alphabet, Amazon, Costco Wholesale, MercadoLibre, Sea Limited, Target, and The Trade Desk. The Motley Fool recommends Grab. The Motley Fool has a disclosure policy.