Trading Nation

Chipotle and two other once left-for-dead stocks are surging this year, and some say they are still a buy

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Once left-for-dead stocks are surging this year

Three stocks that got pummeled last year — TripAdvisor, Chipotle and Under Armour — are making impressive rebounds in 2018. All three show promise for the rest of the year, according to some market strategists.

TripAdvisor, one turnaround stock burning up the charts, looks like it has even more potential to Miller Tabak equity strategist Matt Maley. That stock has done a 180 this year, rebounding 41 percent after a 26 percent decline in 2017.

"Over the last month, I was very worried about this stock because it was a little overbought, it was coming up against some key resistance levels," Maley told CNBC's "Trading Nation" on Tuesday. "But it broke above those resistance levels."

TripAdvisor is now bumping up against the long-term trendline stretching back to its 2014 highs. Chances are good that it can break through that resistance level, Maley said.

"The short interest in the stock is still very, very high so [if] you get another breakout move above another resistance level, those shorts are going to be squeezed again and it could move quite a bit higher," said Maley.

Short interest in TripAdvisor shares is at 19.3 percent of its total float.

Chipotle and Under Armour look like buys to Larry McDonald, editor of the Bear Traps Report. Chipotle is up 50 percent in 2018 after a 23 percent decline last year, while Under Armour has increased 39 percent following a 50 percent drop in 2017.

"Definitely buy the dips in Chipotle and Under Armour, especially on the Chipotle side," McDonald said Tuesday on "Trading Nation." "If you look at [activist investor Bill] Ackman and his history of ownership in some of these names, … there's a chance that he could try to force an acquisition."

Ackman's hedge fund Pershing Square owns a 10 percent stake in Chipotle as well as a 10 percent position in Burger King parent Restaurant Brands.