2 Underperforming Stocks That Could Be on the Verge of a Turnaround
After years of poor returns, these names are finally climbing higher — and I'm buying the turnaround stories.
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Investors in Thermo Fisher Scientific TMO have had a rough ride. Despite a roaring bull market that has carried the major indexes to a series of new highs, Thermo Fisher Scientific shareholders have experienced negative returns in each of the past three years.
Things are no better this year, as the stock is down 9.5% year-to-date in 2025.
Despite the stock’s miserable track record, is it possible that the Waltham, Massachusetts-based provider of laboratory equipment and analytical instruments is about to become a turnaround story?
On Wednesday, Thermo Fisher shares roared higher for a 9% gain, as the company beat Wall Street earnings and revenue estimates. The stock enjoyed its highest turnover this year, trading more than double its average volume.
The company boosted the lower end of its anticipated annual adjusted profit from $21.76 per share to $22.22, while maintaining the upper end of that range at $22.84.
The move boosted the stock to a three-month high. Where are shares of Thermo Fisher Scientific headed next?
The next challenge is the stock’s 200-day moving average (red), currently resting at $495. If TMO can break above that key indicator, which has contained the stock for the past six months, Thermo Fisher Scientific could make a run at $606, its highest closing price of 2025.
Campbell’s Shares are Heating Up
The Campbell’s Company CPB is another name that has performed poorly in recent years. Over the past five years, shares of the Camden, New Jersey-based soup purveyor have lost 32% of their value.
The good news for Campbell’s shareholders is the stock has gained about 8% so far this week. As a result, Campbell’s just closed above its 50-day moving average (blue) for the first time in three months.
In addition to having upside potential, at its current price Campbell's shares boast a dividend yield of 4.68%. Earnings for the soup maker are expected to be released on August 28.
Searching for Value
Why are Thermo Fisher Scientific and Campbell's moving higher?
It’s possible that investors are growing wary of buying the same tech names at higher and higher prices. Perhaps they are searching for value in beaten-down names to balance out their portfolios, due to the growth of their tech holdings.
While there might be some value hidden in these names, there’s no hiding the fact that buyers have chosen this time to step into Thermo Fisher and Campbell’s.
I’m following them in, opening small positions in both names, and I'll add to these positions if and when appropriate. As always, I'll be ready to exit if these two stocks turn south.
At the time of publication, Ponsi was long TMO and CPB.
