We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
3 Cyclical Stocks to Buy for Snapback Potential in 2026
Read MoreHide Full Article
Key Takeaways
CROX targets more than $5B in revenues by 2026, backed by brand investment, product expansion and margin gains
G-III Apparel gains from a shift to higher-margin owned brands, led by growth in Donna Karan and menswear.
Dover is seeing steady booking growth, improving business trends and solid demand across most segments.
The performance of cyclical stocks is closely linked with the overall health of the economy. The prices of these stocks tend to rise quickly during economic expansion and plummet when the economy turns sour. The companies falling into this category produce, market and sell products and services that are highly coveted, particularly when people are making good money.
Over the past year, these cyclical stocks have borne the brunt of inflationary pressures, an increase in labor market slack, ongoing supply-chain disruptions and tariff-related issues. Despite this, the U.S. economy has demonstrated a pattern of resilience and signs of improvement. Although the year started with the first-quarter GDP contraction of 0.6%, the metric rebounded with solid 3.8% growth in the second quarter.
Per the latest report published by the Federal Reserve Bank of Atlanta, the U.S. GDP is estimated to grow 3.5% in the third quarter too. The metric is expected to benefit from resilient consumer spending, lower interest rates and reduced imports.
Although inflation is still elevated, above the Federal Reserve’s 2% target, it is moving downward. The Fed has resorted to three rate cuts this year. The scenario of easing monetary policies augurs well for cyclical stocks as it is likely to reduce borrowing costs and stimulate the economy, in turn, boosting overall demand.
Below, we have discussed three beaten-down cyclical stocks, such as G-III Apparel Group, Ltd. (GIII - Free Report) and Crocs, Inc. (CROX - Free Report) in consumer discretionary, and Dover Corp. (DOV - Free Report) in the industrial products sector. These are seen as key beneficiaries of the structural tailwinds and are expected to enter 2026 with strong growth potential.
These stocks either sport a Zacks Rank #1 (Strong Buy) or carry a Zacks Rank #2 (Buy) and have a market capitalization of more than $1 billion. Stocks with larger market capitalization can better withstand market downturns and hence are considered safer bets. Additionally, the Zacks Consensus Estimate for 2026 earnings has also been revised favorably, highlighting their likely strong performance next year. You can see the complete list of today’s Zacks #1 Rank stocks here.
3 Cyclical Stocks to Buy for 2026
Crocs is a leading footwear brand with focus on comfort and style. The Zacks Rank #1 company offers a wide variety of footwear products, including sandals, wedges, flips and slides that cater to people of all ages.
Crocs remains firmly on track with the long-term growth strategy, aimed at delivering sustainable and profitable expansion. The strategy centers on three priorities: first, igniting its iconic products across brands to strengthen consumer awareness and relevance; second, investing in Tier 1 markets to drive share gains through enhanced talent, marketing, digital, and retail capabilities; and third, broadening its product portfolio to attract a wider customer base. CROX’s long-term targets include surpassing $5 billion in annual revenues by 2026, representing a five-year compounded annual growth rate (CAGR) of more than 17%.
Management had earlier forecast revenues to witness a CAGR of 25% in 2026. Alongside revenue growth, it expects improved profitability, with adjusted operating margins above 26% and strong annual free cash flow generation of more than $1 billion, supporting reinvestment and shareholder returns.
In the past 60 days, the Zacks Consensus Estimate for Crocs’ 2025 and 2026 earnings has improved 1.6% and 8.6%, respectively. Although the company’s shares have declined 19.5% in the past year, they have recovered 16.3% in the past month. With a forward 12-month price-to-earnings of 7.13X, much below the industry average of 16.43X, the stock presents an attractive valuation for investors.
Image Source: Zacks Investment Research
G-III Apparel is a designer, manufacturer and distributor of apparel and accessories under licensed brands, owned brands and private label brands. The Zacks Rank #2 company stands as a global fashion entity with strong capabilities in design, sourcing, distribution and marketing.
G-III’s ongoing transition toward higher-margin owned brands continues to be one of its most compelling long-term value drivers, with third-quarter fiscal 2026 results already demonstrating tangible financial uplift. This is supported by stronger full-price selling and a richer mix of Donna Karan, DKNY, Karl Lagerfeld and Vilebrequin. Donna Karan remains a standout engine of value creation, with sales expected to grow nearly 40% in fiscal 2026—far exceeding the company’s mid-single-digit owned-brand growth outlook for that year. From a brand perspective, the company continues to see strong growth in its women’s business in North America. The global men’s business remains a key growth driver, complementing women’s offerings with nearly 20% growth in the quarter.
In the past 60 days, the Zacks Consensus Estimate for G-III Apparel’s fiscal 2026 and fiscal 2027 earnings has increased 6.3% and 3.4%, respectively. Although the company’s shares have declined 9.6% in the past year, they have rebounded 48.6% in the past six months. With a forward 12-month price-to-earnings of 10.49X, which is much below the industry average of 16.43X, the stock presents a potentially attractive valuation for investors.
Image Source: Zacks Investment Research
Dover is an industrial conglomerate producing a wide range of specialized industrial products and manufacturing equipment. The Zacks Rank #2 company’s operating segments are Engineered Products, Clean Energy and Fueling, Imaging and Identification, Pumps and Process Solutions, and Climate and Sustainability Technologies.
Dover’s bookings remain healthy across most of its segments. DOV has reported year-over-year booking growth in seven of the past eight quarters. Booking trends in the company’s polymer processing business are also improving, with the business expected to resume growth in the fourth quarter for the first time in more than two years. The company expects this trend to continue. This is being driven by strong demand across the majority of the company’s business and its ability to produce and ship despite several operating challenges. Solid new order intake also continues to aid growth.
In the past 60 days, the Zacks Consensus Estimate for Dover’s 2025 and 2026 earnings has increased 1.3% and 1.1%, respectively. Although the company’s shares have declined in the past year, they have gained 11.4% in the past six months. With a forward 12-month price-to-earnings of 18.59X, which is below the industry average of 21.73X, the stock presents a potentially attractive valuation for investors.
Image Source: Zacks Investment Research
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
3 Cyclical Stocks to Buy for Snapback Potential in 2026
Key Takeaways
The performance of cyclical stocks is closely linked with the overall health of the economy. The prices of these stocks tend to rise quickly during economic expansion and plummet when the economy turns sour. The companies falling into this category produce, market and sell products and services that are highly coveted, particularly when people are making good money.
Over the past year, these cyclical stocks have borne the brunt of inflationary pressures, an increase in labor market slack, ongoing supply-chain disruptions and tariff-related issues. Despite this, the U.S. economy has demonstrated a pattern of resilience and signs of improvement. Although the year started with the first-quarter GDP contraction of 0.6%, the metric rebounded with solid 3.8% growth in the second quarter.
Per the latest report published by the Federal Reserve Bank of Atlanta, the U.S. GDP is estimated to grow 3.5% in the third quarter too. The metric is expected to benefit from resilient consumer spending, lower interest rates and reduced imports.
Although inflation is still elevated, above the Federal Reserve’s 2% target, it is moving downward. The Fed has resorted to three rate cuts this year. The scenario of easing monetary policies augurs well for cyclical stocks as it is likely to reduce borrowing costs and stimulate the economy, in turn, boosting overall demand.
Below, we have discussed three beaten-down cyclical stocks, such as G-III Apparel Group, Ltd. (GIII - Free Report) and Crocs, Inc. (CROX - Free Report) in consumer discretionary, and Dover Corp. (DOV - Free Report) in the industrial products sector. These are seen as key beneficiaries of the structural tailwinds and are expected to enter 2026 with strong growth potential.
These stocks either sport a Zacks Rank #1 (Strong Buy) or carry a Zacks Rank #2 (Buy) and have a market capitalization of more than $1 billion. Stocks with larger market capitalization can better withstand market downturns and hence are considered safer bets. Additionally, the Zacks Consensus Estimate for 2026 earnings has also been revised favorably, highlighting their likely strong performance next year. You can see the complete list of today’s Zacks #1 Rank stocks here.
3 Cyclical Stocks to Buy for 2026
Crocs is a leading footwear brand with focus on comfort and style. The Zacks Rank #1 company offers a wide variety of footwear products, including sandals, wedges, flips and slides that cater to people of all ages.
Crocs remains firmly on track with the long-term growth strategy, aimed at delivering sustainable and profitable expansion. The strategy centers on three priorities: first, igniting its iconic products across brands to strengthen consumer awareness and relevance; second, investing in Tier 1 markets to drive share gains through enhanced talent, marketing, digital, and retail capabilities; and third, broadening its product portfolio to attract a wider customer base. CROX’s long-term targets include surpassing $5 billion in annual revenues by 2026, representing a five-year compounded annual growth rate (CAGR) of more than 17%.
Management had earlier forecast revenues to witness a CAGR of 25% in 2026. Alongside revenue growth, it expects improved profitability, with adjusted operating margins above 26% and strong annual free cash flow generation of more than $1 billion, supporting reinvestment and shareholder returns.
In the past 60 days, the Zacks Consensus Estimate for Crocs’ 2025 and 2026 earnings has improved 1.6% and 8.6%, respectively. Although the company’s shares have declined 19.5% in the past year, they have recovered 16.3% in the past month. With a forward 12-month price-to-earnings of 7.13X, much below the industry average of 16.43X, the stock presents an attractive valuation for investors.
Image Source: Zacks Investment Research
G-III Apparel is a designer, manufacturer and distributor of apparel and accessories under licensed brands, owned brands and private label brands. The Zacks Rank #2 company stands as a global fashion entity with strong capabilities in design, sourcing, distribution and marketing.
G-III’s ongoing transition toward higher-margin owned brands continues to be one of its most compelling long-term value drivers, with third-quarter fiscal 2026 results already demonstrating tangible financial uplift. This is supported by stronger full-price selling and a richer mix of Donna Karan, DKNY, Karl Lagerfeld and Vilebrequin. Donna Karan remains a standout engine of value creation, with sales expected to grow nearly 40% in fiscal 2026—far exceeding the company’s mid-single-digit owned-brand growth outlook for that year. From a brand perspective, the company continues to see strong growth in its women’s business in North America. The global men’s business remains a key growth driver, complementing women’s offerings with nearly 20% growth in the quarter.
In the past 60 days, the Zacks Consensus Estimate for G-III Apparel’s fiscal 2026 and fiscal 2027 earnings has increased 6.3% and 3.4%, respectively. Although the company’s shares have declined 9.6% in the past year, they have rebounded 48.6% in the past six months. With a forward 12-month price-to-earnings of 10.49X, which is much below the industry average of 16.43X, the stock presents a potentially attractive valuation for investors.
Image Source: Zacks Investment Research
Dover is an industrial conglomerate producing a wide range of specialized industrial products and manufacturing equipment. The Zacks Rank #2 company’s operating segments are Engineered Products, Clean Energy and Fueling, Imaging and Identification, Pumps and Process Solutions, and Climate and Sustainability Technologies.
Dover’s bookings remain healthy across most of its segments. DOV has reported year-over-year booking growth in seven of the past eight quarters. Booking trends in the company’s polymer processing business are also improving, with the business expected to resume growth in the fourth quarter for the first time in more than two years. The company expects this trend to continue. This is being driven by strong demand across the majority of the company’s business and its ability to produce and ship despite several operating challenges. Solid new order intake also continues to aid growth.
In the past 60 days, the Zacks Consensus Estimate for Dover’s 2025 and 2026 earnings has increased 1.3% and 1.1%, respectively. Although the company’s shares have declined in the past year, they have gained 11.4% in the past six months. With a forward 12-month price-to-earnings of 18.59X, which is below the industry average of 21.73X, the stock presents a potentially attractive valuation for investors.
Image Source: Zacks Investment Research