Though it’s tough to recognize the opportunity at the moment, bear market cycles offer a compelling entry point to some of the best bargain stocks to buy. Certain companies in particular have suffered substantial double-digit losses over the trailing month, which ordinarily isn’t a great sign. However, bearish traders may have gone too far as these names are tied with credible fundamental narratives.
To be fair, there’s plenty of scary-sounding headline print that shouldn’t be ignored. If you follow business news closely, you’ll know that we just incurred the worst first-half performance in the equities sector since 1970. Furthermore, some of the same headwinds have popped up, such as inflation and warfare. Nevertheless, with the U.S. equities sector generally enjoying an upward bias, it may be time to consider the best bargain stocks to buy in July.
For the purposes of this article, I have picked out seven companies with the worst trailing-month performance since the close of the July 1 session. Therefore, you will almost surely encounter choppiness so patience is a must. Nevertheless, if you can handle the pressure, these may be the best bargain stocks to buy in July.
|Blade Air Mobility
Best Bargain Stocks to Buy: Borr Drilling (BORR)
Delivering high-quality drilling operations in hydrocarbon basins around the world, you would ordinarily expect Borr Drilling (NYSE:BORR) to perform well given Russia’s invasion of Ukraine and it has. On a year-to-date (YTD) basis, BORR stock is up nearly 75%. However, in the trailing month, shares have dropped almost 45%.
What’s the cause of Borr Drilling’s sudden change of fortune? Mainly, the hydrocarbon sector faces near-term headwinds of rising interest rates and increased supply. Recently, the federal government released significant supplies from the U.S. strategic petroleum reserve. This action helped cool off what has been a blisteringly hot market.
Still, I would classify Borr Drilling as one of the best bargain stocks to buy to get the second half of this year on the right foot. Although the immediate circumstances don’t bode well for BORR stock, the longer-term narrative is a net positive for Borr Drilling.
Callon Petroleum (CPE)
As an independent oil and natural gas company focused on the acquisition, exploration and development of high-quality assets in the leading oil plays of West and South Texas, Callon Petroleum (NYSE:CPE) enjoyed for the most part a solid first half of the year. Unfortunately, the trailing month has not been too kind for CPE stock, which saw the stock drop 38%.
Again, the culprit can be tied to the near-term headwinds impacting Borr Drilling above and other hydrocarbon-related companies. With the Federal Reserve committed to raising interest rates to combat soaring inflation, the easy money policy may shift to a hard money policy; as in, hard-to-get money. The subsequent pressure on households and the broader economy presents a negative picture for Callon.
Nevertheless, CPE stock may be one of the best bargain stocks to buy in July because of the geopolitical paradigm shift. Even green-friendly Democrats must realize that we need to start tapping into our own resources. Therefore, patient investors of Callon Petroleum could be rewarded down the line.
Best Bargain Stocks to Buy: U.S. Silica (SLCA)
Presumably, U.S. Silica (NYSE:SLCA) doesn’t get much attention as an energy-related company because it’s not what you would call a direct player in the upstream segment of the oil and gas industry. However, this lack of constant media spotlights is what helps make SLCA stock one of the best bargain stocks to buy in July. In my opinion, it’s a hidden gem.
It goes without saying that U.S. Silica specializes in its namesake asset. Well, large quantities of silica sand are used during hydraulic fracturing or more commonly referred to as fracking. To be fair, fracking is a controversial subject because of its negative impact, as many environmental advocates have pointed out.
I’m not here to suggest that fracking is a wonderful activity for the planet. But because of the circumstance in eastern Europe, energy independence has again risen to the forefront of our political discourse. Invariably, fracking will have to be considered as a geopolitical tool, perhaps benefitting SLCA stock as one of the best bargain stocks to buy.
Power REIT (PW)
Structured as a real estate investment trust (REIT), Power REIT (NYSEAMERICAN:PW) makes for an intriguing — albeit, speculative — idea among the best bargain stocks to buy in July. Per the U.S. Securities and Exchange Commission (SEC), to “qualify as a REIT, a company must have the bulk of its assets and income connected to real estate investment and must distribute at least 90 percent of its taxable income to shareholders annually in the form of dividends.”
So, why is Power REIT down more than 37% in the trailing month? At least part of the reason is that the entity currently doesn’t pay a dividend.
Still, by law, it will have to do so soon. Therefore, speculators can position themselves early in PW stock before the potential wave comes in. And I’m not just saying that. The underlying company specializes in three relevant sectors: agriculture, solar farmland and transportation — specifically, railroad infrastructure.
Best Bargain Stocks to Buy: EVgo (EVGO)
Although analysts often love to say that electric vehicles (EVs) are the future, the problem from an investment standpoint is that seemingly everyone got the memo. Just from a brief Internet search, I can see well over 30 publicly traded companies that are directly tied or related to the EV sector. Put another way, the segment is getting saturated and frankly, it’s unlikely that everyone will become a winner.
However, when you start talking about EV infrastructure, the concept becomes more palatable. While it’s difficult to predict which brand will dominate the segment once EVs go mainstream, drivers will need access to charging platforms — since not everyone has a garage. That’s where EVgo (NASDAQ:EVGO) comes into the picture.
To be clear, infrastructure plays like EVGO stock aren’t completely immune to EV challenges, particularly their high price point. Still, if you have a high conviction that the electrification of transportation will materialize, EVGO stock seems like one of the best bargain stocks to buy this month.
Blade Air Mobility (BLDE)
Although the novel coronavirus pandemic forced millions of workers to operate remotely, this new normal might not last indefinitely. More than a few companies have expressed serious concerns about telecommuting and since they sign some of the biggest paychecks in the labor force, they ultimately have the power. So, it wouldn’t surprise me to see vehicular traffic reach all-time highs.
At the same time, that’s going to cause problems for the affluent members of society. Thus, for executives and other powerbrokers to get to their destination quickly and conveniently, Blade Air Mobility (NASDAQ:BLDE) — with its fleet of helicopters — can help those willing to pay rise above us the traffic.
Now, “willing to pay” sounds like a crude marketing point for BLDE stock. However, I’m just being realistic. One of the biggest winners in terms of attainment of wealth during the Covid-19 pandemic has been — no shocker here — the top 1% of American society.
In other words, the total addressable market for Blade Air Mobility is larger than you think, making BLDE stock one of the best bargain stocks to buy for gamblers.
Best Bargain Stocks to Buy: Vicarious Surgical (RBOT)
If you want to try to swing for the fences with the best bargain stocks to buy in July, you might want to turn your attention to Vicarious Surgical (NYSE:RBOT). Specializing in minimally invasive surgery, Vicarious utilizes advanced robotics and precision instruments to help foster superior patient outcomes. The company currently focuses on abdominal access and visualization through a single port.
Considering the extensive costs associated with not only traditional surgical procedures but the subsequent downtime, Vicarious’ technologies at scale could yield significant financial savings to patients. Therefore, the holistic potential for RBOT stock is very exciting.
Now, the bad part. Vicarious is first and foremost aspirational, meaning that it’s a pre-revenue company. And while it’s seeking a breakthrough device certification from the U.S. Food and Drug Administration (FDA), it has yet to receive regulatory approval.
Overall, it’s a long shot is what I’m trying to say. But it could be worth it if you have some pocket change lying around.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.