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The best time to buy stocks is when they are cheap. But investors need to be aware of this – without a reason for things to change, stocks can remain unpopular 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 I look for opportunities.
The One Big Beautiful Bill Act
One of the biggest forces I expect to impact the stock market in 2026 is the One Big Beautiful Bill (OBBBA) in the US. And there are a few big steps along the way.
Consumer spending makes up about 70% of the US economy. And OBBBA is set to make lower tax rates permanent, while introducing a higher standard deduction for households.
In agriculture, this bill strengthens income protection that supports farmers when prices fall below certain levels. It also provides additional support for crop insurance premiums.
OBBBA is also important to other industries, including semiconductors, automotive manufacturing, and health care. But in terms of stocks, I’m focused on consumer spending and agriculture.
Diageo
US families with a lot of money can be a great deal Diageo (LSE:DGE). I FTSE 100 The firm has struggled with US sales recently, but its competitive position remains strong.
The big question for investors is why income has been struggling. Is it because household budgets have been under pressure, or is there a long-term shift in preferences taking place?
My view is that at least part of the problem has been a temporary decline. But the way to get a clear idea of this is to keep an eye on the volumes at American retailers during the year.
If this starts to improve, recovery may be on the way. And while Diageo is trading at some of its lowest levels in the last 10 years, I think it’s worth considering.
CNH Industrial
Farming is a notoriously cyclical industry. And that means a tractor company CNH Industrial (NYSE:CNH) is best used to see earnings volatility from year to year.
Weak crop prices mean lower investment in new equipment recently. But the OBBA is set to give farmers – especially those with large operations – a guarantee of more income in the future.
That may encourage investment in new equipment and I expect CNH to benefit if it does. That’s why I was buying the stock recently at a 30% discount to its 52-week high.
The risk of crop price fluctuations will not go away completely. But the time to look at this type of stock is when it has bottomed out – and I think there are signs of a possible recovery on the way.
Buying and holding
From a long-term perspective, the best time to buy stocks is when they are undervalued. And with companies like Diageo and CNH, their prices go through obvious cycles.
The question is when the recovery is likely to happen – and there is a cost to getting there early. But in both cases, I think there are good signs on the horizon for the next few months.
That’s why I think both are worth considering for investors looking for opportunities. However, if I’m right, they won’t be around forever.
