2 Growth Stocks Down Over 70% That Could Rebound in 2025

Source The Motley Fool

Regularly investing in growing companies is a recipe for wealth-building gains over many years. But when you can buy shares of these companies at attractive valuations, it can help your investments perform even better.

Here are two fallen stocks of companies that are continuing to invest in the future and could be bargains ahead of a rebound.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. See the 10 stocks »

1. Celsius Holdings

Shares of Celsius Holdings (NASDAQ: CELH) have been phenomenal performers for investors in recent years, but they are about 70% off their highs. With the energy drink market continuing to grow, this leading brand could be a great buy on the dip.

Revenue was growing more than 100% year over year just over a year ago, but a supply chain adjustment from the company's largest distributor has weighed on the top line. Revenue fell 31% year over year in the third quarter, but actual retail demand for the product is holding up much better. The company said retail and unit sales were up 7% year over year last quarter, which indicates growing demand for Celsius products.

Celsius has benefited tremendously from its distribution agreement with PepsiCo and will continue to do so over the long term. It is the No. 3 brand across tracked channels in the U.S. energy drink market, which is expected to increase from $211 billion in 2024 to $262 billion by 2029, according to Statista.

Moreover, Celsius was responsible for 16% of the growth in the energy category last quarter. Management is continuing to invest in marketing and new products to bring in new consumers, so if the brand can continue to lead the market in growth, it will lead to higher revenue, earnings, and shareholder returns.

The company's "better for you" marketing resonated with consumers by offering products that are made with no sugar or artificial ingredients. And as retailers see more consumers buying Celsius, it builds a relationship that could lead to merchants offering it more shelf space, which could drive further market share gains.

At the current share price of $28, the stock is trading at a reasonable 29 times 2025 earnings estimates. Analysts currently expect Celsius to return to revenue growth in 2025 before accelerating to a double-digit increase in 2026. Assuming those estimates hold up, the stock offers enough value right now to support more gains.

2. Dollar General

Dollar General (NYSE: DG) has a long history of delivering consistent sales growth and superior returns to investors. From 2011 through 2021, the stock had a total return, including dividends, of 516%, significantly beating the S&P 500.

Weak sales trends over the past year sent the stock down 74% off its previous high, and the shares were still hitting new lows at the time of this writing, down to $67. But the shares could be significantly undervalued, as management improves the stores to deliver better financial results.

Dollar General is implementing several improvements to return to growth. It recently made significant improvements to cleaning up stores and increasing the number of in-stock items, where customer surveys have already shown higher satisfaction.

Improvements with the supply chain, including speeding up delivery and implementing automation in distribution centers, may take time to show up in sales and earnings. But the company is not performing as badly as you would think given the stock's recent decline. Net sales grew 5% year over year in the third quarter, with same-store sales up 1.1%.

With management guiding for full-year earnings per share to be between $5.50 to $5.90, it should be able to continue paying a quarterly dividend of $0.59 per share. That brings the forward dividend yield to an attractive 3.52%, nearly three times the S&P 500 yield.

On a forward price-to-earnings basis, the stock is trading at 12 times 2025 earnings estimates. This is cheap if the company can achieve its long-term target of double-digit earnings growth.

All said, the improving customer satisfaction could lead to better financials sooner than Wall Street expects. There's a good chance for a rebound this year assuming Dollar General offers more good news on its progress with store improvements in the next few quarters.

Don’t miss this second chance at a potentially lucrative opportunity

Ever feel like you missed the boat in buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts issues a “Double Down” stock recommendation for companies that they think are about to pop. If you’re worried you’ve already missed your chance to invest, now is the best time to buy before it’s too late. And the numbers speak for themselves:

  • Nvidia: if you invested $1,000 when we doubled down in 2009, you’d have $357,084!*
  • Apple: if you invested $1,000 when we doubled down in 2008, you’d have $43,554!*
  • Netflix: if you invested $1,000 when we doubled down in 2004, you’d have $462,766!*

Right now, we’re issuing “Double Down” alerts for three incredible companies, and there may not be another chance like this anytime soon.

See 3 “Double Down” stocks »

*Stock Advisor returns as of January 13, 2025

John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Celsius. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Gold rebounds above $4,350 as US Dollar, Treasury yields slipGold price (XAU/USD) rebounds from a nearly one-month low to around $4,385 during the early Asian session on Thursday. The precious metal edges higher as the ‌US Dollar (USD) and Treasury yields retreat from recent highs.
Author  FXStreet
Sep 03, Thu
Gold price (XAU/USD) rebounds from a nearly one-month low to around $4,385 during the early Asian session on Thursday. The precious metal edges higher as the ‌US Dollar (USD) and Treasury yields retreat from recent highs.
placeholder
Gold rebounds above $4,450 as Waller tempers Fed rate hike bets ahead US jobs dataGold price (XAU/USD) gains momentum to around $4,470 during the early Asian session on Friday. The precious metal extended its recovery as Federal Reserve (Fed) rate hike bets ease. All eyes will be on the US August Nonfarm Payrolls (NFP) report, which is due later on Friday. 
Author  FXStreet
Sep 04, Fri
Gold price (XAU/USD) gains momentum to around $4,470 during the early Asian session on Friday. The precious metal extended its recovery as Federal Reserve (Fed) rate hike bets ease. All eyes will be on the US August Nonfarm Payrolls (NFP) report, which is due later on Friday. 
placeholder
Hot August jobs report reignites Fed-hike bets; S&P 500 slips below 7,700 — what to watch before the September FOMCAugust nonfarm payrolls surged to 162,000, three times the consensus, pushing CME FedWatch odds of a September 25-bp hike to 58.4% and dragging the S&P 500 below 7,700. CPI, PPI and the Sept 15-16 FOMC decision now set the tone for US stocks.
Author  Irene Q.
Sep 07, Mon
August nonfarm payrolls surged to 162,000, three times the consensus, pushing CME FedWatch odds of a September 25-bp hike to 58.4% and dragging the S&P 500 below 7,700. CPI, PPI and the Sept 15-16 FOMC decision now set the tone for US stocks.
placeholder
Japanese Yen rallies to February 18 high as upbeat wage data and GDP lift BoJ hike betsThe USD/JPY pair declines for the second straight day – also marking the fourth day of a fall in the previous five – and sinks to its lowest level since February 18, around mid-153.00s during the Asian session on Tuesday.
Author  FXStreet
22 hours ago
The USD/JPY pair declines for the second straight day – also marking the fourth day of a fall in the previous five – and sinks to its lowest level since February 18, around mid-153.00s during the Asian session on Tuesday.
placeholder
AUD/USD climbs for a fourth day to 0.7218 as Fed-hike bets fail to lift the dollar; RBA speakers and US CPI now in focusThe Australian dollar has risen for four straight sessions toward 0.72 even after August nonfarm payrolls far exceeded expectations and pushed September Fed-hike odds to 58.4%. A thin, holiday-thinned dollar is the short-term driver; Westpac confidence and RBA speakers today, US PPI/CPI this week and the Sept 15-16 FOMC will decide whether the rally holds.
Author  Irene Q.
17 hours ago
The Australian dollar has risen for four straight sessions toward 0.72 even after August nonfarm payrolls far exceeded expectations and pushed September Fed-hike odds to 58.4%. A thin, holiday-thinned dollar is the short-term driver; Westpac confidence and RBA speakers today, US PPI/CPI this week and the Sept 15-16 FOMC will decide whether the rally holds.
goTop
quote