With the first half of 2025 nearly over, many investors are taking time to reevaluate their portfolios and take advantage of quality stocks that can be bought at a discount. It certainly requires some confidence to buy shares of a company when they're down, but it's opportunities like these that offer the potential for outsize returns.
Two Fool.com contributors, for example, recognize that oil supermajor Chevron (CVX 1.44%) and data center equipment provider Vertiv (VRT 5.27%) are two worthy considerations for investors to click the buy buttons on right now since they're stocks are trading down 23% and 26%, respectively, from recent all-time highs.
Image source: Getty Images.
Take advantage of low energy prices to buy Chevron and grow your passive income stream
Scott Levine (Chevron): While the 23% decline in Chevron stock from its all-time high in January 2023 may be disconcerting, the truth is that the stock's fall isn't wholly unexpected. There's a strong correlation between the movements of energy prices and those of energy stocks, so when investors pair Chevron stock's plunge with the 22% dip in the price of oil benchmark West Texas Intermediate during the same time period, the performance in Chevron's stock becomes much more understandable.
Whether you're on the prowl for a reliable dividend stock or a steady energy stock or something in between, Chevron fits the bill. For 38 consecutive years, the company has hiked its dividend -- a notable achievement for any company but especially one whose business revolves around commodities along with their cyclical prices. Lest investors fear that the company is sacrificing its financial health to placate shareholders, a peek at Chevron's average payout ratio over the past five years should allay their concerns: It's a conservative 68.4%.
NYSE: CVX
Key Data Points
Unlike some companies that solely focus on exploration and production, or those with midstream businesses, or downstream operations, Chevron operates throughout the energy value chain. This provides it with the ability to benefit from greater efficiencies than companies with more concentrated operations, as well as mitigating the risks associated with a slowing in the business of any one link in the energy value chain.
For those looking to put some pep in their passive income streams, now seems like a great time to gas up on Chevron stock.
This Nvidia partner's growth is only getting started
Lee Samaha (Vertiv): Data center equipment provider and Nvidia partner Vertiv's stock trades down about 26% from its all-time high. It has recovered significantly recently, but despite a strong run, it's still an overall dip worth buying into.
That reasoning relies on assuming that we are in the early innings of investment in artificial intelligence (AI) applications and the data centers necessary to support AI growth. As recently discussed, there are no signs of a slowdown in data center spending, and that bodes well for the near-term outlook.
NYSE: VRT
Key Data Points
Thinking more medium-term, Vertiv's data center power systems are set to play a key role in the new generation of data centers that Nvidia is building toward. Nvidia believes the new 800-volt (V) high voltage direct current (HVDC) data centers (set to be launched in 2027) can improve efficiency by 5%, reduce copper usage, and lower maintenance costs by 70%, and also lower cooling costs.
The good news is that Vertiv plans to have its 800-V HVDC power systems ready by the second half of 2026, in time for deployment with Nvidia's key platform rollouts in 2027. That should drive the next cycle of orders at Vertiv, and as long as AI demand continues to explode, it's likely that Vertiv's total addressable market for its power systems, thermal management, and data center infrastructure will also grow strongly.
Should you buy these stocks now?
While semiconductor stocks often get the lion's share of attention regarding AI, Vertiv is a great consideration for investors looking to gain AI exposure -- especially with 2026 shaping up to an auspicious year of developments for the company. On the other hand, income investors who have the patience to wait out a downturn in energy prices have a great opportunity to power up their passive income streams right now with Chevron stock.
