2 stocks to buy before they bounce back in 2026?
The best time to buy stocks is when theyâre cheap. But investors need to be careful with this â without a reason for things to change, shares can stay out of favour for a long time.
Right now, though, I think there are stocks that have struggled recently where clear signs of tangible improvement are starting to emerge. And this is where Iâm looking for opportunities.
The One Big Beautiful Bill Act
One of the major forces that I expect to influence the stock market in 2026 is the One Big Beautiful Bill Act (OBBBA) in the US. And there are a few major moves on the way.
Consumer spending makes up around 70% of the US economy. And the OBBBA is set to make lower tax rates permanent, while introducing higher standard deductions for households.
In agriculture, the bill strengthens revenue protections that subsidise farmers when crop prices fall below certain levels. It also offers more support with crop insurance premiums.
The OBBBA is also significant for other industries, including semiconductors, car production, and healthcare. But in terms of stocks, Iâm focusing on consumer spending and agriculture.
Diageo
US households having more money could be a very good thing for Diageo (LSE:DGE). The FTSE 100 firm has struggled with US sales recently, but its competitive position is still strong.
The big question for investors is why revenues have been struggling. Is it because household budgets have been under pressure, or is there a more durable shift in preferences going on?
My view is that at least part of the issue has been a temporary downturn. But the way to get a clearer sense of this is by keeping an eye on volumes at US wholesalers during the year.
If this starts to improve, a recovery could be on the way. And while Diageo is trading at some of its lowest levels in the last 10 years, I think itâs well worth considering.Â
CNH Industrial
Farming is a notoriously cyclical industry. And that means tractor company CNH Industrial (NYSE:CNH) is well used to seeing its revenues fluctuate from one year to another.
Weak crop prices have meant lower investment in new equipment recently. But the OBBA is set to give farmers â especially ones with larger operations â more revenue certainty in future.
That might well incentivise investment in new machinery and I expect CNH to benefit if it does. Thatâs why Iâve been buying the stock recently at a 30% discount to its 52-week highs.
The risk of fluctuating crop prices wonât go away entirely. But the time to look at this type of stock is when itâs in a downturn â and I think there are signs a recovery could be on the way.
Buying and holding
From a long-term perspective, the best time to buy shares is when theyâre undervalued. And with companies like Diageo and CNH, their share prices move in relatively obvious cycles.
The question is when a potential recovery might take place â and thereâs a cost to being early. But in both cases, I think there are positive signs on the horizon in the next few months.
Thatâs why I think both are worth considering for investors looking for opportunities. If Iâm right, though, they arenât going to be around forever.
The post 2 stocks to buy before they bounce back in 2026? appeared first on The Motley Fool UK.
Should you invest £1,000 in Diageo plc right now?
When investing expert Mark Rogers has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.
And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Diageo plc made the list?
More reading
- 2 beaten-down UK shares to consider in an ISA before they recover
- Diageo shares just got even cheaper
- Iâve just had an astonishing insight into the Diageo share price â and why it could fall further
- Can you earn £1,000 a month in passive income with £34,800 in a Stocks and Shares ISA?
- Can the Glencore share price smash Diageo in 2026?
Stephen Wright has positions in CNH Industrial and Diageo Plc. The Motley Fool UK has recommended Diageo Plc. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
