3 Beaten-Down Stocks With Rebound Potential This Earnings Season
Earnings season often shines a spotlight on well-known mega-caps, but it can also bring opportunities for lesser-known companies to shine. Below are three stocks—each down significantly in 2025—that could stage a comeback if their upcoming earnings updates hit the right notes. These are not safe bets, but they offer asymmetric upside for risk-tolerant investors.
Scholar Rock: Biotech Speculation Backed by Solid Phase 3 Results
Scholar Rock Holding Corp. (NASDAQ: SRRK) is a biotech firm focused on developing protein therapeutics to treat neuromuscular diseases.
Its lead asset is a drug called apitegromab, which is indicated for Type 2 and Type 3 Spinal Muscular Atrophy (SMA).
While still in development, apitegromab has made significant strides toward marketization thanks to the FDA and has shown robust Phase 3 data, suggesting strong potential for regulatory approval in 2026.
Despite this progress, SRRK shares have dropped about 33% year-to-date (YTD) due to issues with a manufacturing site, which raised short-term concerns.
However, the company’s long-term clinical development remains on track. As Scholar Rock announced in its second-quarter earnings report, a Phase 2 study of apitegromab showed the drug added over 54% lean mass preservation on GLP-1 agonist tirzepatide compared to control, an additional sign of the drug's therapeutic promise.
With this in mind, investors watching Scholar Rock when the company reports third-quarter earnings on Nov. 14 should note that the company's fundamental performance may not yet shift dramatically—losses per share are projected to be 76 cents, and it's still too early for the company to generate revenue. Instead, look for further promising details about apitegromab, as well as encouraging signs about other drugs further down its pipeline. Investors may also look to the company's cash position for signals about its runway through anticipated FDA approval of apitegromab.
Analysts are very optimistic—13 out of 14 see SRRK as a Buy, including more than 65% in upside potential.
High-Risk, High-Reward AI Business Play
Tech services firm Globant (NYSE: GLOB) offers IT services and digital transformation solutions, with a strong focus on artificial intelligence. It had a middling second quarter, which has contributed to a decline of about 70% YTD.
However, its AI pipeline is booming, having climbed year-over-year (YOY) to $3.7 billion. There is massive potential there, but Globant has so far been unable to deliver to the degree that investors want to see.
The upcoming earnings report will provide Globant with the opportunity to demonstrate that it can effectively convert AI demand into revenue and profit.
Investors will look closely for top- and bottom-line improvements, as well as margin growth that is more substantial.
This may be a long shot based on Globant's prior guidance, which suggested essentially flat sales performance on a YOY basis. However, if the company is able to deliver even a small win in the report, the stock could be poised for a significant rally. Although investors are cautious—just seven out of 17 have called GLOB shares a Buy—the consensus price target suggests the stock could nearly double under the right conditions. For investors willing to stomach the volatility, this could be a pivotal moment for earnings.
Acquisition and Cloud/AI Business Boost NiCE's Prospects
Customer engagement and workforce optimization software maker NiCE Ltd. (NASDAQ: NICE) has found solid footing in the cloud and AI spaces, helping to strengthen its annual recurring revenue.
The company's acquisition of generative AI provider Cognigy is only further boosting its offerings and should contribute to full-year revenue growth of 7% YOY, according to estimates in its second-quarter earnings report.
Despite these positive signs, though, NICE shares have fallen almost a quarter YTD. Investors appear to be waiting for a more prominent catalyst before buying. With short interest falling by about 12% in the last month, optimism appears to be mounting among retail investors.
Analysts, too, are fairly bullish, with eight out of 14 assigning NICE shares a Buy rating. Investors sharing this perspective could see 57% in predicted upside potential. There is no specific signal that traders will watch for in the upcoming earnings report, but a broad improvement in fundamentals could send NICE shares skyward.
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