3 Contrarian Stock Picks That Could Surprise the Market in 2025

Group 1: Roku - Roku stock has seen a significant decline, currently 83% off its all-time highs, despite a recent 50% increase over the past six months [2] - The company is experiencing growth in its membership base and revenue while reducing expenses, leading to improved profitability [3] - Roku's ad platform is gaining traction, with viewing hours on its free ad-supported channel increasing by 80% year over year in Q3, contributing to its recent gains [4] - The price-to-sales ratio is less than 3, indicating potential for growth in 2025 [5] Group 2: Wayfair - Wayfair's sales have declined post-pandemic, but the online home furnishings platform remains a strong contender for recovery [6] - The company has made progress by lowering expenses and improving its net loss, despite a challenging housing market [7][9] - Revenue per active customer increased by 1.3% over the trailing 12 months, highlighting strategic investments in customer relationships [8] - Wayfair stock is currently 87% off its all-time highs and trades at a low ratio of 0.5 times trailing 12-month sales, presenting a potential opportunity for risk-tolerant investors [10] Group 3: Peloton - Peloton stock has dropped 94% from its all-time highs due to overexpansion and management issues during the pandemic [11] - The company is working on improving its cost structure and reducing total expenses, with gross profit up 6% and gross margin expanding to 51.8% [12][13] - The new CEO, Peter Stern, has experience in subscription businesses, which may help in turning the company around [14]