2 Unloved Stocks of 2026 to Consider Buying Now
Key Points
Broadcom's revenue growth sped up from 29% to 86% through the first three quarters of its fiscal 2026.
Adobe has raised its full-year targets in each of its past two quarterly reports.
Both stocks trade at lower price-to-earnings ratios than the S&P 500, using expected earnings.
It's been a lopsided year for tech investors. The VanEck Semiconductor ETF is up about 52% in 2026 as of this writing. But chip designer Broadcom (NASDAQ:AVGO) is down about 3% this year. At roughly $334, its stock trades about 31% under June 2's close of $481.57, the highest ever.
Adobe (NASDAQ:ADBE) has dropped even more. Shares of the creative software maker have risen about 33% from their June 25 low close of $193.41.
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But at about $257, the stock is still about 63% under the record close of $688.37 it hit in November 2021.
I don't think either business is in trouble, though. Both companies' latest quarterly reports showed healthy growth, and both stocks now cost less than the overall market relative to the earnings they're expected to post.
Here's a closer look at each.
Image source: The Motley Fool.
1. Broadcom: faster growth, a lower stock price
Most of Broadcom's drop came quickly. The stock shed around a fifth of its value over the two trading days after its June 3 earnings report, and it hasn't closed within 10% of that record since.
The business, though, kept speeding up. Showing this momentum, Broadcom's revenue climbed 86% year over year to $29.6 billion in its fiscal third quarter of 2026 (the period ending Aug. 2). That was up from growth of 48% in the fiscal second quarter and 29% in the fiscal first quarter. And management forecast fiscal fourth-quarter revenue of around $34.8 billion, which would be about 93% above the year-ago quarter's $18.0 billion. Profits kept up, too. In fiscal Q3, Broadcom's non-GAAP (adjusted) earnings per share almost doubled year over year, and free cash flow jumped 95% to $13.7 billion.
Put another way, the business grew faster every quarter in a year when its shares have been about flat.
The key risk is how much of this growth comes from a few buyers. Broadcom estimates its top five end customers accounted for around 55% of its revenue in fiscal Q3, up from about 40% a year before. If one of them cuts back, results might swing sharply.
But going by analysts' consensus for fiscal 2027, the stock sells for around 17 times earnings. At that price, investors arguably already allow for a lot of this concentration risk.
2. Adobe keeps raising its targets
Adobe's drop began long before this year, and 2026 hasn't helped. Even after its bounce from the June low, the stock is down around 27% for the year. A lot of the pessimism seems to come from worries that artificial intelligence (AI) might undercut software companies like Adobe.
The company's results tell a steadier story. In the fiscal third quarter of 2026 (the period ended Aug. 28, 2026), Adobe's revenue grew 13% year over year to $6.76 billion, the highest of any quarter on record. Its adjusted earnings per share climbed 15% to $6.13. And Adobe said it topped 1 billion monthly active users across its creativity and productivity products.
Not only did growth hold up, but management also raised its full-year targets for the second straight quarter. Adobe now expects fiscal 2026 adjusted earnings per share between $24.45 and $24.50, up from the $23.30 to $23.50 range it gave in December.
Sure, growth might be slowing a little. Management's fourth-quarter target of $6.80 billion to $6.85 billion in revenue would put growth at 10% to 11% compared to the $6.19 billion Adobe took in during the year-ago quarter.
But the stock is priced for much worse than that. At around $257, shares cost about 10.5 times the adjusted earnings Adobe expects to make this fiscal year (taking the midpoint of its target).
Both cost less than the market
By comparison, the S&P 500 (SNPINDEX:^GSPC) trades at around 19 times earnings, using analysts' estimates for the next 12 months. So investors buying either stock today pay less for every dollar of expected profit than they would for the index -- even though both companies grew adjusted earnings per share by double digits last quarter.
The two face different risks, of course. Broadcom relies on a few very big customers, and Adobe's growth is probably slowing from the pace of its best years. But I think both sell-offs have gone further than the businesses justify.
I'd consider buying both stocks today, building each position gradually.
Daniel Sparks and his clients do not have positions in any of the stocks mentioned. The Motley Fool has positions in and recommends Adobe and Broadcom. The Motley Fool recommends the following options: long January 2028 $330 calls on Adobe and short January 2028 $340 calls on Adobe. The Motley Fool has a disclosure policy.