There are some stocks on Wall Street that are absolutely hated by analysts and investors, but their fundamentals are improving, leaving a potential buying opportunity for contrarian investors, according to UBS. Stocks have rallied to record highs in recent times, with large-cap names primarily leading the pack. The S & P 500 has jumped 10% this year. But some large caps are not participating and remain unloved. In a Thursday note, strategist Jonathan Golub ran a screen for clients that found stocks that had poor ratings from Wall Street and have been forgotten by investors over the last one year. Here are the firm’s specific criteria: Below average consensus analyst ratings Large 52-week drawdown Strong 3-month earnings momentum One name on the list was Ford Motor . The automotive stock has slipped 4% so far this year. Most analysts currently covering the stock have assigned it a hold rating, with predicted upside of about 16% to consensus price targets. Bernstein initiated shares of Ford at an outperform rating last week, with analyst Daniel Roeska’s $16 price target implying that shares could rally a whopping 38% from here. “The iconic automaker continues to enjoy strong profits from its core markets and a policy driven investment cycle in the U.S,” the analyst wrote. “While electric execution looms large, we see a clear path to significant operating leverage and ultimately profits for the company’s EV unit.” Airbnb fit the criteria as another “unloved” stock. Shares of the short-term rental platform have popped 7% since the start of the year. Most analysts have assigned Airbnb stock a hold rating. The average analyst price target reveals that the stock could rise another 5% from its current level. Earlier this week, Wedbush upgraded Airbnb stock to an outperform rating. Analyst Scott Devitt cited the stock’s recent underperformance on the back of its first-quarter earnings as having opened up an attractive entry point. “We think investors should take advantage of this period of relative weakness and see potential upside to near-term estimates following disappointing 2Q guidance that we view as conservative given positive travel data points thus far in 2Q,” he wrote. Shares of cruise operator Norwegian Cruise Line have plummeted 18% this year, but the stock made the list. The analyst consensus has shares at a hold rating, with predictions suggesting the stock could rise an average of 26% from its Thursday close. Both Truist and Mizuho upgraded the stock to a buy rating from hold earlier this week. Mizuho analyst Ben Chaiken believes that sentiment for the stock is finally shifting as its valuations become more attractive. “After ~2 years of significant relative underperformance (~ -160% vs RCL since Jan ’23) NCLH is streamlining its business (e.g., cost cuts), which should drive upside to near-term/medium-term estimates,” Chaiken wrote. Other names on UBS’ list included Pfizer , Gartner , Clorox , Estee Lauder and Northern Trust . — CNBC’s Michael Bloom contributed to this report.
