Unexpected catalysts are driving the share prices of some previously beaten down stocks sharply higher, presenting a buying opportunity for investors. Surprise earnings beats, new partnerships and takeover rumors are lifting the share prices of several well-known companies that had fallen on hard times.
For investors, these catalysts present an opportunity to take a position as the stocks begin to rally off their recent bottoms, riding the share price to big gains. In the current set-up, the potential rewards offered by these stocks far outweigh the risks. Here are three stocks to buy right now without any hesitation.
FedEx (FDX)
Shipping and logistics giant FedEx (NYSE:FDX) has just reported strong quarterly financial results, sending its share price 15% higher. The company announced EPS of $5.41 versus $5.35 that was expected on Wall Street. Revenue in what was the company’s fiscal fourth quarter totaled $22.11 billion compared to $22.07 billion that was estimated.
FedEx also reported that its capital expenditures during fiscal 2024 totaled $5.2 billion, down 16% from $6.2 billion in fiscal 2023. The capital spending decline comes as the company implements cost-cutting measures aimed at saving $4 billion by the end of the current 2025 fiscal year. As for guidance, FedEx raised its outlook for fiscal 2025, saying it expects mid-single-digit revenue growth driven largely by the e-commerce business.
Another reason to like FDX stock is that the company, earlier in June, raised its quarterly dividend payment to shareholders by 10%, taking the distribution to $1.38 per share and giving the stock a yield of 2.15%. FedEx’s share price is now up 25% in the last 12 months.
Rivian Automotive (RIVN)
Shares of Rivian Automotive (NASDAQ:RIVN) are up an incredible 30% in one-day on news that German automotive giant Volkswagen is investing $5 billion in the electric vehicle start-up. Volkswagen’s investment in Rivian is beginning with an initial injection of $1 billion. The additional $4 billion will be allocated in tranches through 2026. The two companies said that the investment is being made to create a joint venture that will see the two automakers work on electrical architecture and software technology.
The sharp move higher in RIVN stock is welcome news. Before news of the Volkswagen investment, Rivian stock had been down 90% since the company went public in November 2021. Rivian’s stock had come under pressure due to the company’s cash burn and mounting losses. The electric vehicle maker reported a net loss of $1.45 billion in this year’s first quarter. In recent months, Rivian has cut staff, retooled its Illinois plant to increase efficiencies, and halted construction on a new factory in Georgia.
The cash infusion from Volkswagen, plus the cost-cutting, should help get Rivian and its stock back on track, making now an opportune time to take a position.
Whirlpool (WHR)
Now might also be a good time to buy shares of Whirlpool (NYSE:WHR) with takeover rumors swirling around the appliance manufacturer. WHR stock rose 12% after Reuters reported that German engineering firm Bosch is considering acquiring Michigan-based Whirlpool. No deal has been publicly announced and it’s not clear how much Bosch would pay for Whirlpool, which has a market capitalization of $5.33 billion.
But that hasn’t stopped the media reports from sending Whirlpool stock higher. The potential takeover comes as Bosch, the world’s biggest automotive supplier, is relying on acquisitions to grow its business. Whirlpool has undergone a major restructuring in recent years, offloading its business operations in Europe, the Middle East and Africa so that it can concentrate on the North American market.
As with Rivian, the rise in WHR stock comes as a relief. The stock of Whirlpool had previously been down 39% over the past 12 months. Should Whirlpool become a legitimate takeover target, its stock would become an arbitrage play.
On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
