Even amid the US stock market breaking new highs, some stocks are still stuck near their 52-week lows.
They could be cheap for fundamentally real reasons.
Or they could be a steal for deep-value investors looking to benefit from the temporary mispricing of the market.
Let’s explore a few and find out more.
Adobe (NASDAQ: ADBE) — The Temporary Disruption Story
The advent of AI is a game-changer for content creators.
Instead of spending years in design schools to master industry tools such as Adobe Photoshop, Premiere, and Illustrator, videos and images can now be generated within minutes using a few AI prompts.
Adobe, being a leader of these iconic creative tools, has borne the brunt of the fear from these disruption narratives, having plunged to a multi-year low.
However, Adobe derives most of its revenue from its enterprise clients, where royalty management and delivering content while avoiding legal complications matter more than mere content output, which is increasingly commoditised by AI.
Moreover, the creative giant maintains a growing financial profile.
In its first fiscal quarter ended 27 February 2026 (1QFY2026), Adobe’s revenue grew 12% to US$6.40 billion, driving operating cash flow up 19% to US$2.96 billion.
This growth was driven not just by subscription revenue – the company’s AI-first Annual Recurring Revenue (ARR), which tripled year on year (YoY), contributed too.
Far from being disrupted, Adobe is leveraging AI to uplift its applications and offerings.
AI can disrupt the standalone features of Adobe’s creative “tools”, but not the broader creative infrastructure and enterprise records built up over decades, which underscores Adobe’s moat.
ServiceNow (NYSE: NOW) — The Sector Sell-Off Victim
ServiceNow’s stock price has been brutally beaten down due to the sector-wide sell-off – a consequence of the deep perception of its offerings being disrupted due to AI.
It doesn’t help when geopolitical tensions have caused delays to ServiceNow’s sovereign cloud deals in the Middle East, causing unsightly revenue gaps (although the drag in 1Q2026 was just 0.75%).
In the first quarter of 2026 (1Q2026), ServiceNow’s total revenue increased 22% YoY to US$3.77 billion.
Including the aforementioned delayed (but not lost) revenue, ServiceNow’s revenue growth would have been 22.75%.
Meanwhile, free cash flow was up by 4% to US$1.67 billion, due to savings from AI efficiencies generated by “Now on Now”, the company’s program of using its own software platform internally.
The market is missing what matters most to ServiceNow, which is its role as a key “System of Record” – making it more than just a pure-play SaaS.
AI has the potential to disrupt some software services, but not a workflow orchestrator such as ServiceNow, which manages not just mission-critical enterprise workflows, but also its records.
To believe that enterprises are willing to risk losing these records with a casual replacement is, in the CEO’s own words, a “parlour trick”.
Nike (NYSE: NKE) — The Growth Reset Play
Digital commerce is great – consumers can shop 24-hours online, and there are low recurring costs with maximum margins.
However, it doesn’t work for all businesses, and Nike learned it the hard way.
For years, its “NIKE Direct-first offence” strategy, which relies heavily on its Direct-to-Consumer (DTC) digital sales channels, enjoyed success, especially during the pandemic.
However, by 2022, the strategy proved counterproductive.
Competitors were gladly filling up the empty third-party retail shelf spaces left by Nike.
But all is not lost as the footwear giant’s brand equity makes up for its execution blunder.
In its third fiscal quarter ended 28 February 2026 (3QFY2026), Nike’s revenue was flat YoY at US$11.3 billion, while net profit declined 35% to US$0.5 billion because of severance charges, tariff headwinds, and other transitory expenses.
Without the one-time expenses, the management claims Nike’s underlying profitability improved, anchored by the growth in its North American market.
Although Nike’s turnaround remains a work in progress, the company increased its dividend by 2.5% YoY to US$0.41 per share, showing its commitment to uphold its unbroken 24-year record of growing its dividend.
With the return of long-time Nike executive Elliott Hill as CEO in late 2024, aside from claiming back retail shelf spaces, Nike is also undergoing a growth reset to revamp its strategic focus towards “athlete-centred” innovation.
Get Smart: Discern Between Value Traps and Value Opportunities
With stocks that are down, investors should question whether they are really getting a steal protected by a wide margin of safety.
Right now, Adobe’s creative tools might appear at risk of AI disruption, but its entrenched brand recognition within enterprise customers makes up for it.
Nike’s deep brand recognition among athletes provides a strong footing to execute a successful turnaround eventually.
And right now, the market is not appreciating ServiceNow’s broader role as a key System of Record among its customers.
Smart Investors focus on recovery potential, not just cheap valuations.
Not all AI “winners” will survive this cycle.
But a few companies already have the scale, cash flow, and edge to pull ahead. We highlight what to look for in our FREE volatile market report. Download it here.
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Disclosure: Larry L. owns shares of Adobe and Nike.
