3 Stocks Well Below 52-Week Highs Poised for a Q4 ReboundWritten by Gabriel Osorio-Mazilli. Published 10/25/2025.
Key Points- These three stocks trade well below their 52-week highs, making their setups carry a high chance of pricing in downside while leaving all the upside potential intact.
- There is enough EPS growth set up for the fourth quarter of 2025 to land these names on an upswing.
- Wall Street analysts believe this can be the case as their recent upgrades suggest.
Technical analysis has many uses, but one of the most important is assessing where a stock trades relative to its 52-week high. A 20% drop from that high is commonly used as a benchmark to distinguish bear-market territory from bullish momentum. The following three stocks are trading well below their 52-week highs and are effectively in bear-market territory.
MercadoLibre Inc. (NASDAQ: MELI), Rocket Companies Inc. (NYSE: RKT), and On Holding (NYSE: ONON) are all below that 20% threshold. Because they sit in the consumer discretionary sector, some of their declines may reflect sector-wide concerns—rather than company-specific problems. Going forward, investors should focus on two things: whether the market has already priced in a consumer slowdown due to inflation and tariffs, and whether there is evidence their businesses can deliver stronger results by the end of Q4 2025. Each company has a different business model and product mix, offering diversified upside potential for a portfolio.
MercadoLibre’s Bottoming Sent Bears Running
Top 10 U.S. Stocks to Buy & Forget Until 2030 (Ad)Tired of chasing the market every week? Our new free report reveals 10 U.S. stocks you can confidently buy now and hold long term — handpicked by a veteran investor with over 20 years of experience and backed by deep research into megatrends like AI, EVs, and cloud tech.
Click here to get the 10 Stocks to Buy and Hold — free for a limited time
Short interest in MercadoLibre has declined by 13.8% over the past month, which can be a sign of bearish capitulation. The Latin American e-commerce platform has a year-to-date gain of 23.6%, creating a notable inflection point.
Trading at about 79% of its 52-week high, MercadoLibre is close to moving back into bullish momentum while still giving buyers room to capture further upside. With that attractive risk/reward profile, it’s worth noting where analysts expect the stock to go.
The consensus price target is $2,810.88, implying roughly 33.7% upside from the current price. There are outliers as well: in October 2025 Susquehanna’s James Friedman set a $2,900 target (down from a prior $2,975).
Institutional activity also points to growing optimism. In October, Swedbank increased its position by 11.9%, bringing its total stake to $321.5 million. Much of the consumer-related fear may already be priced in, but Q4 will be critical.
The MarketBeat consensus for Q4 EPS is $13.79, a 34% jump from the reported $10.31, and that expected earnings lift is the main driver of the current optimism for the name.
Rocket’s Beatdown No Longer Has Legs to ItWith several U.S. housing indicators—such as falling building permits and rising inventory—showing softness, mortgage-related stocks like Rocket Companies fell to about 76% of their 52-week highs. That level is approaching a valuation floor given current industry signals.
This makes Rocket a compelling risk/reward candidate. Eric Hagen of BTIG Research predicts the stock could reach $25 per share (a Buy rating). That target is well above the consensus price target of $17.12, but there are reasons to consider the call credible.
If the Federal Reserve eases and mortgage rates fall, buyer demand could pick up and absorb the existing backlog of listings. Q4 is pivotal for Rocket not only because of potential rate cuts but also due to expected earnings improvement.
The MarketBeat consensus for Q4 EPS is $0.12, about three times the current $0.04. That anticipated earnings lift may not be fully reflected in the stock’s depressed price, offering investors a chance to benefit if the recovery plays out.
Tariffs Were Overdone for On HoldingOn Holding has meaningful exposure to China, both as a market and as part of its supply chain, which prompted a tariff-related selloff. The stock now trades at roughly 65% of its 52-week high, placing it deep in bear-market territory and suggesting unpriced earnings potential.
The consensus price target of $63.65 implies about 53.5% upside. The market has assigned a 92.2x price-to-earnings (P/E) ratio to the stock—far above the retail sector’s 18.8x average—indicating strong confidence in On’s growth prospects.
That premium reflects the market’s belief in On Holding’s brand strength, growth trajectory, and exposure to global consumer trends. If the company delivers solid Q4 results and sustains momentum, it could narrow the valuation gap and support further upside in the stock. |
