The World Cup may be over, but investors aren't getting much of a break from the action. While Spanish fans are celebrating their team's championship victory, Wall Street is still playing through extra time, with markets swinging between optimism and caution.

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After a strong run, stocks have entered a more volatile phase as investors navigate geopolitical conflicts, renewed inflation concerns, higher oil prices, shifting interest-rate expectations, and bouts of profit-taking. Even the AI trade, one of the market's biggest winners over the past two years, has cooled as investors reassess valuations and the pace of future infrastructure spending.

Yet, beneath the day-to-day headlines, the broader picture remains constructive. As second-quarter earnings season kicks off, FactSet estimates S&P 500 companies will deliver 23.3% year-over-year earnings growth, marking a second consecutive quarter of growth above 20%.

That constructive outlook is shared by Chris Hyzy, chief investment officer for Merrill and Bank of America Private Bank, who wrote, "While it feels like a disconnect, markets aren't ignoring bad news. Instead, sound economic fundamentals are enabling markets to see past today's turbulence to potentially transformative growth ahead… We see periodic weakness as a potential buying opportunity as markets focus on long-term growth themes such as AI innovation, infrastructure replacement and re-industrialization."

Bank of America analyst Ross Fowler is taking the logical next step by looking for stocks that offer compelling buying opportunities. Fowler zeroed in on two, both of which feature recent share price pullbacks, Buy ratings, and sound upside potential. TipRanks data shows that both also earn Strong Buy ratings on Wall Street, so let's take a closer look and see what's driving the enthusiasm across the board.

Fervo Energy Company (FRVO)

We'll start in the energy sector, where demand for carbon-free power continues to grow. The world's energy industry, especially in the West, is shifting toward cleaner energy, and Fervo is pioneering a new approach.

The company develops geothermal power projects, an old concept, but is applying new technologies to the field. Fervo is using advances in drilling technology developed over the past decade in the oil and gas industry, to improve the performance and efficiency of geothermal well designs. The company is applying techniques such as horizontal drilling to reach geothermal reservoirs and create multiple wells from single locations. In addition, the company is making use of fiber optic cable technology, sending fiber optics into the wells to gain real-time data on flow, temperature, and performance that would be difficult or impossible to learn from the surface.

The upshot here is that Fervo is able to increase the efficiency of geothermal power systems. The basic technique remains the same – to circulate water through hot underground rock formations, where it absorbs heat before being brought to the surface to generate electricity. The use of newer drilling and data retrieval technologies allows the company to reap efficiencies in everything from reliability to land use to cost.

Fervo has had a number of important headlines in recent months. In June, the company announced an agreement with the Pacific Northwest National Laboratory (PNNL) to develop a new geothermal platform, the next generation of the tech, based on Enhanced Geothermal Systems (EGS) technology and dubbed the EGS-Twin. As part of the agreement, the companies will use Fervo's field data and expertise to train AI models using Nvidia's AI computing platform. Fervo states that the operation aims to "optimize power generation and strengthen the scalability of enhanced geothermal systems."

Fervo went public earlier this year, beginning trading on May 13 after selling 70 million shares at $27 each and raising $1.89 billion in gross proceeds. Despite the strong IPO, the stock is now down 33% from its first day closing price as investors weigh a deep quarterly net loss and projected capital expenditures of $1.2 billion going forward.

In the 1Q26 financial report, released in June, Fervo's top line came to $61,000 and missed expectations by over $600,000. The company reported a net loss of $31.8 million, much deeper than the $9.1 million net loss seen in the first quarter of 2025. The results reflected the company's early stage of commercialization and continued heavy investment in expanding its geothermal platform.

For Bank of America analyst Ross Fowler, who is ranked among the top 10% of Wall Street analysts by TipRanks, the recent pullback has made the stock even more compelling.

"Our fundamental outlook and probability-weighted SOTP methodology are largely unchanged, but the shares now offer compelling upside to our PO. The recent Sawtooth 7 drilling result strengthens our conviction in Fervo's learning-curve thesis: the company completed a longer, deeper, hotter and larger-diameter Phase II well in 21 days, matching its prior Cape Phase I record. With 658 MW of binding PPAs, a $7.2B backlog, a 3 GW Google framework and Cape Station under construction, we believe the current valuation provides a particularly attractive buying opportunity," Fowler opined.

An "attractive buying opportunity" leads naturally to a Buy rating from the analyst, and his price target, at $36, suggests a one-year upside potential of 46%. (To watch Fowler's track record, click here)

Wall Street is even more bullish. Fervo earns a Strong Buy consensus rating based on 11 analyst reviews, including 10 Buys and just one Hold. With shares trading at $24.65, the average price target of $46 points to about 87% upside over the next 12 months. (See FRVO stock forecast)