These Underperforming Stocks in 2025 Could Be Popular Picks in Early 2026
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 05 2025
0mins
Should l Buy ARES?
Source: Benzinga
Market Rotation Insight: Goldman Sachs highlights a recurring trend where underperforming stocks from the previous year, termed "laggards," often outperform the S&P 500 in the first quarter of the new year, based on 23 years of market data.
2025 Laggards Performance: The current laggards for 2025 are showing significant underperformance, with an average decline of 19% and a 36% drop relative to the S&P 500, indicating a larger pool of beaten-down stocks than usual.
Potential Recovery Stocks: Goldman Sachs has identified several stocks, including Fortinet, Pool Corp., and Hormel Foods, that are considered mispriced and could lead a rally in early 2026, despite most analysts being neutral or bearish on them.
Caution on Predictions: While the laggard-to-leader strategy has historically shown promise, it is not guaranteed, and investors should remain cautious as January 2026 approaches, as it may bring unexpected movements from previously overlooked stocks.
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Analyst Views on ARES
Wall Street analysts forecast ARES stock price to rise
10 Analyst Rating
8 Buy
2 Hold
0 Sell
Strong Buy
Current: 112.650
Low
155.00
Averages
191.40
High
223.00
Current: 112.650
Low
155.00
Averages
191.40
High
223.00
About ARES
Ares Management Corporation is an alternative investment manager offering clients complementary primary and secondary investment solutions across various asset classes. Its segments include Credit Group, Private Equity Group, Real Assets Group, Secondaries Group, and Other. The Credit Group segment manages credit strategies across the liquid and illiquid spectrum, including liquid credit, alternative credit, direct lending and APAC credit. The Private Equity Group segment categorizes its investment strategies as corporate private equity, special opportunities and APAC private equity. The Real Assets Group segment manages comprehensive equity and debt strategies across real estate and infrastructure investments. The Secondaries Group segment invests in secondary markets across a range of alternative asset class strategies, including private equity, real estate, infrastructure and credit. It has operations across North America, South America, Europe, Asia Pacific and the Middle East.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Market Leadership: Convergint operates over 220 technology centers globally, providing security and life safety solutions, and since Ares' investment in 2018, its Adjusted EBITDA has nearly quadrupled, demonstrating robust organic growth and over 40 acquisitions that solidify its market position.
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- Withdrawal Concerns: The situation has been exacerbated by significant withdrawal requests from investors, raising concerns about liquidity and fund stability.
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- Capital Commitment: Ares Management announced the closure of a single-asset continuation vehicle for Convergint Technologies with approximately $850 million in commitments, reflecting strong confidence in the company's ongoing growth and expected to further enhance its market leadership.
- Strategic Investment: In addition to the continuation vehicle, Ares has made a substantial new investment in Convergint, ensuring shared control alongside existing partners LGP and Harvest Partners, thereby strengthening strategic support for the company.
- Market Leadership: Convergint operates over 220 technology centers globally, providing security and life safety solutions, and since Ares' investment in 2018, its Adjusted EBITDA has nearly quadrupled, demonstrating robust organic growth and over 40 acquisitions that solidify its market position.
- Future Outlook: As demand rises for providers with global scale, deep vertical expertise, and strong local leadership, Convergint's ability to navigate complex risk environments for customers will be enhanced, and the confidence from Ares and LGP in its growth trajectory will drive long-term value creation.
See More
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- Market Rebound: Trump's announcement that the U.S. will insure Gulf shipping and escort tankers through the Strait of Hormuz led to a market rebound after significant losses, with the S&P 500 closing down about 1%, well off its session lows of roughly 2.5%, indicating market sensitivity to geopolitical risks.
- Oil Price Impact: The assurances regarding oil trade not only boosted stock prices but also eased crude oil price pressures, highlighting that fluctuations in the oil market could have broader macroeconomic implications that investors need to monitor closely.
- Private Credit Concerns: Blackstone's Jon Gray defended the quality of loans from its main private credit fund, despite allowing investors to withdraw nearly 8% of their investments, which caused Blackstone shares to fall nearly 4%, reflecting growing market concerns about the health of the private credit sector.
- Congressional Hearing Pressure: Commerce Secretary Howard Lutnick voluntarily agreed to testify before the House Oversight Committee regarding his ties to sex offender Jeffrey Epstein, which has drawn bipartisan scrutiny, although he has not been accused of wrongdoing, potentially impacting his political future.
See More
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- Investor Redemption Situation: In the last quarter, Blackstone's flagship private credit fund BCRED allowed investors to withdraw 7.9% of their capital, approximately $650 million, leading to an 8.5% drop in the company's stock price on Tuesday morning, indicating heightened market concerns about private credit.
- Loan Quality Defense: Blackstone President Jon Gray highlighted that over 400 borrowers in BCRED achieved 10% EBITDA growth last year, expressing optimism about loan quality despite the bearish market sentiment, which he believes will help stabilize investor confidence.
- Market Reaction Analysis: Although Blackstone's measures to allow investor redemptions aimed to address liquidity needs, this move did not alleviate market tensions but instead sparked broader concerns about the private credit sector, particularly regarding loans in the software industry.
- Fund Performance Data: BCRED has delivered an annualized return of 9.8% since inception for Class I shares, with a Blackstone spokesperson emphasizing the firm's commitment to meeting redemption requests, showcasing confidence in the fund and alignment with investors.
See More
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- Oil Price Surge: Global benchmark Brent crude prices have surged 8% to over $84 per barrel, reaching a new 52-week high, driven by fears of prolonged supply disruptions that could hinder global economic recovery.
- Apple Price Target Raised: Barclays raised its price target on Apple from $239 to $248, adjusting estimates based on expectations for the upcoming foldable and Pro models, although the market's muted response suggests a need to monitor its performance among megacaps.
- MongoDB Shares Plummet: MongoDB shares fell 27% after its flagship database product Atlas reported a slower-than-expected growth rate of 29% in Q4, coupled with disappointing revenue guidance for fiscal 2027, indicating increased competitive pressures.
- Target Shares Rise: Target's stock rose over 4% in premarket trading after the retailer reported better-than-expected earnings for the holiday quarter, with new CEO indicating positive year-over-year sales in February, marking a significant milestone in the company's growth trajectory.
See More
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- Impact on Alternative Asset Managers: Some alternative asset managers are experiencing declines following issues with Blackstone's private credit fund.
- Withdrawal Concerns: The situation has been exacerbated by significant withdrawal requests from investors, raising concerns about liquidity and fund stability.
See More
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- Blackstone's Private Credit Fund: The flagship private credit fund of Blackstone experienced significant redemptions in the first quarter, indicating challenges within the private credit sector.
- Impact on Stock Performance: Following the news of redemptions, Blackstone's stock saw a decline during early trading on Tuesday.
See More
