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Stocks Poised for Recovery: Analyst Picks Amid Market Volatility

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  Published in Stocks and Investing on Tuesday, February 24th 2026 at 17:56 GMT by MarketWatch
      Locales: New York, California, Texas, UNITED STATES

By Amelia Hayes

It's been a turbulent start to 2026 for many investors. Market volatility, coupled with shifting economic landscapes, has led to significant declines for a number of previously high-performing stocks. However, amidst the red, Wall Street analysts are identifying opportunities - companies that have suffered substantial drops (at least 20%) but are believed to possess the fundamental strength for a robust recovery. This isn't about chasing quick gains; it's about identifying fundamentally sound businesses currently trading at potentially discounted prices.

This analysis isn't simply about finding stocks that have fallen; it's about assessing why they fell, and crucially, whether those reasons are likely to be temporary or indicative of deeper, irreversible problems. The ten stocks highlighted below have faced headwinds in early 2026, but analysts largely agree they're positioned for a potential turnaround. Let's dive into each one.

The Tech Sector's Resilience

The technology sector, while still driving innovation, has experienced some correction in 2026. Advanced Micro Devices (AMD), down over 36%, is a prime example. Despite the drop, analysts maintain a bullish outlook, citing AMD's ongoing leadership in the crucial artificial intelligence (AI) market. The current price dip is viewed as a temporary overreaction, offering an attractive entry point for long-term investors. Similarly, NVIDIA (NVDA), even with a 25% decline, remains a dominant force in AI chip manufacturing, and its long-term prospects remain exceptionally strong. The company's hardware underpins many of the latest advancements in machine learning and data processing, solidifying its position at the forefront of a rapidly growing industry.

Consumer Discretionary & Retail: Adapting to Shifting Spending Patterns

Consumer behavior has been a key driver of market fluctuations. Costco Wholesale (COST), down 24%, continues to demonstrate the power of its membership model, providing a consistent revenue stream even during economic uncertainty. The company's ability to offer value during inflationary periods makes it a resilient player. Etsy (ETSY), with a 31% drop, is banking on innovation to regain momentum. The platform faces increased competition, but analysts believe its unique niche and focus on handmade and vintage goods give it a strong competitive advantage. Williams-Sonoma (WSM), down 32%, is anticipating a resurgence in home goods spending. While consumer spending has been cautious, improvements are expected as the year progresses, benefitting companies like Williams-Sonoma.

The Automotive Revolution & Beyond

General Motors (GM), experiencing a 31% decline, is betting big on the electric vehicle (EV) revolution. The transition to EVs is capital intensive and fraught with challenges, but GM is investing heavily in its EV infrastructure and product line. Analysts are optimistic that improved EV technology and increasing consumer adoption will drive future growth. Dell Technologies (DELL), down 35%, is benefiting from a recovering enterprise market, as businesses upgrade their IT infrastructure. The demand for PCs, servers, and data storage solutions remains strong, supporting Dell's bottom line.

E-Commerce & Off-Price Retail: Finding Opportunities in a Competitive Landscape

Shopify (SHOP), facing a 28% decrease, is working to refine its e-commerce platform and cater to the evolving needs of online merchants. Improvements to its functionality and user experience are expected to attract more businesses and drive growth. Ross Stores (ROST), down 25%, is a classic example of a successful off-price retailer. Its ability to source discounted merchandise and offer it at attractive prices continues to resonate with value-conscious consumers. And finally, Airbnb (ABNB), down nearly 34%, continues to innovate in the travel sector, and analysts predict a bright future for the platform as it expands its offerings and reaches new markets.

Important Considerations

It's critical to remember that identifying stocks poised for a rebound is not a guarantee of success. Market conditions can change rapidly, and unforeseen events can impact any investment. This list is based on current analyst expectations and should not be considered financial advice. Investors should conduct their own thorough research and consider their individual risk tolerance before making any investment decisions.