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Is Now the Time to Buy the 3 Worst-Performing Stocks in the S&P 500 This Year?
DECKDeckers(DECK) The Motley Fool·2025-04-02 01:05

Group 1: Market Overview - The S&P 500 index is down approximately 5% at the start of 2025, indicating investor concerns about the economy [1] - Stocks are experiencing a significant decline, reflecting broader economic worries [1] Group 2: Deckers Outdoor - Deckers Outdoor is the worst-performing stock on the S&P 500, down 46% [3] - The company reported a 17% revenue growth in Q4 2024, with net sales of 1.8billion,butanalystswerenotsatisfiedwithitsguidanceprojecting151.8 billion, but analysts were not satisfied with its guidance projecting 15% growth for the current year [3][4] - The stock was previously trading at over 35 times its trailing earnings but has since dropped to about 18 times [4] - Economic uncertainties, including trade wars and tariffs, pose risks to Deckers' business, and there is potential for guidance cuts [5] Group 3: Tesla - Tesla is the second worst-performing stock, down 38%, facing challenges due to questionable growth prospects and controversies surrounding CEO Elon Musk [6] - The company's automotive revenue fell by 8% in Q4, totaling 19.8 billion, with profits declining by 71% year over year to 2.3billion[7]Teslasstockistradingatover90timesitsestimatedfutureearnings,indicatingitremainshighlyexpensivewithpotentialforfurtherdecline[8]Group4:OnSemiconductorOnSemiconductoristhethirdworstperformingstock,down362.3 billion [7] - Tesla's stock is trading at over 90 times its estimated future earnings, indicating it remains highly expensive with potential for further decline [8] Group 4: On Semiconductor - On Semiconductor is the third worst-performing stock, down 36%, primarily affected by economic headwinds in the automotive sector [9] - The company reported sales of 7.1 billion in 2024, a 14% decline year over year, suggesting a challenging recovery ahead [10] - On Semiconductor trades at a relatively modest valuation of 16 times next year's estimated earnings, presenting a potential long-term buying opportunity [10][11] - The long-term growth prospects for semiconductor companies are significant, with On Semiconductor's stock at multiyear lows, indicating potential for future recovery [11]