Is Freshpet, Inc. (FRPT) the Best Oversold NASDAQ Stock to Buy Right Now?
We recently published a list of 11 Oversold NASDAQ Stocks to Buy Right Now. In this article, we are going to take a look at where Freshpet, Inc. (NASDAQ:FRPT) stands against other oversold NASDAQ stocks to buy right now.
On April 28, Darrell Cronk, Wells Fargo Wealth and Investment Management CIO, appeared on CNBC's 'Squawk on the Street' to discuss market outlooks and what investors should look at in the current market circumstances. He opined that it is growth that investors should be worried about, not inflation. Cronk was of the view that the market will likely see better buying/entry opportunities in the coming weeks, and so it is essential to be careful when chasing equities too hard. There is a growing divide between sentiment and positioning, as we live in a geopolitical-first world where the rules of the game can change with stunning speed.
Cronk further opined that many people overlook a key fact about tariffs, solely focusing on their inflationary nature. While tariffs are inflationary, they are blunt-force resets in prices and are not sustained inflationary. So, although companies need to be able to absorb the blunt force reset of prices and impact of margins, it's not like one continues to see the rate of change of inflation move meaningfully higher up from years one to two, three, and four. This trend only emerges when tariffs move meaningfully higher up over a period of time.
READ ALSO: Recession Resistant Investing: 10 Best Grocery Stocks To Buy Now and 10 Best Stocks That Will Always Grow.
Cronk also talked about how the president has been screaming at the Fed to slash interest rates. But it's not just the president; the bond market is doing the same. Fed cuts over a period of time are essential. However, according to Cronk, if the Fed shows up tomorrow and announces an emergency cut of sorts, markets wouldn't perceive it so well. The markets would take it as the Fed knowing something they do not, and the growth scare would grow more pervasive and problematic. This is why the Fed has to be careful about how they act.
The Fed appears to be more concerned about inflation, and it has been consistent in that. If they switched to more growth concerns than inflation concerns, the markets would perceive them as more dovish. He said that we just saw the Fed's president saying that June could be on the table for a possible rate cut. The Fed is thus starting to lay the groundwork, and we would have to see how that narrative turns out. If it takes a more dovish approach, markets would perceive that in a well-timed, thoughtful way.
Since April 1, nine of the eleven S&P gig sectors have revised their guidance lower. The problem is that out of the 20%- 25% of the reported earnings that the market has seen right now, less than 20% of them have been willing to give forward guidance. Therefore, Cronk highlighted that the guidance suspension is obviously problematic and important here. The market thus needs consumer discretionary stocks and industrials to hold up and tech to deliver.
Our Methodology
We used stock screeners to compile a list of NASDAQ stocks that experienced significant YTD performance declines. We then selected the 11 stocks with the highest analyst upside potential as of April 29, 2025. We also added the number of hedge fund holders for these stocks as of Q4 2024, sourcing hedge fund data from Insider Monkey's database. The list is sorted in ascending order of the upside potential.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 363.5% since May 2014, beating its benchmark by 208 percentage points ().
A close up of a grocery store shelf with packages of the company's pet food products on it.Freshpet, Inc. (NASDAQ:FRPT) ranks ninth on our list of oversold NASDAQ stocks to invest in now. The company manufactures, markets, and distributes packaged pet food and treats. Its products include a blend of locally farmed vegetables, fresh meat, and fruits. The company's products include Deli Fresh Grain Free Chicken Recipe for Dogs, Ocean Whitefish Recipe for Cats, Joy Turkey and Apple Bites Treats, Nature's Fresh Grain Free Chicken Recipe for Cats, and more.
On April 10, Benchmark Co. analyst Todd Brooks maintained their bullish stance on Freshpet, Inc. (NASDAQ:FRPT) and gave the stock a buy rating. Even though the analyst reduced the stock's price target to $140, he said the company's current and future performance and strong market position in the fresh dog food segment support the Buy rating. These factors are expected to help it attain significant AEBITDA growth by fiscal year 2027. The analyst opined that Freshpet, Inc. (NASDAQ:FRPT) currently holds a modest 3% share in the $37 billion US dog food market, which gives it a competitive advantage.
He also noted that while the company has some short-term challenges, such as macroeconomic pressures affecting consumer confidence and disruptions in the Pet Specialty channel, they will likely be temporary. Freshpet, Inc. (NASDAQ:FRPT) has low exposure to tariff-related expenses, and it is exhibiting a historically strong correlation between advertising and growing website traffic, which the analyst sees as positive indicators of future growth. In another report released on April 10, Stifel Nicolaus maintained a Buy rating on Freshpet, Inc. (NASDAQ:FRPT) and set a $115.00 price target.
Overall, FRPT ranks 9th on our list of oversold NASDAQ stocks to buy right now. While we acknowledge the potential for FRPT as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than FRPT but trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
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