It’s been a rough year for Wall Street and investors.Over the past four and a half months, the benchmark S&P 500 and iconic Dow Jones Industrial Average Both are officially in correction territory with losses of at least 10%.
Meanwhile, the growth-focused focus is far worse Nasdaq Composite (^IXIC -0.30%), fell nearly 30% from peak to trough between its all-time high in mid-November and its recent low.This puts the Nasdaq at bear market.
Image credit: Getty Images.
While the pace of declines during bear markets can be troubling, history show over and over again These dips are ideal times for opportunistic investors to pounce. Every notable drop in major indexes, including the Nasdaq Composite, was eventually wiped out by a bull market rally.
Right now, some of the most jaw-dropping bargains can be found in growth stocks. Here are four amazing growth stocks you’ll regret not buying when the Nasdaq was bearish.
With the Nasdaq down more than a quarter, the first stunning growth stock to gobble up is social media company Pinterest (pin -0.99%).
Wall Street appears to have two main concerns about Pinterest, which was once all the rage. First, the company’s monthly active users (MAUs) fell by 45 million over the past year. User growth is often seen as a key engagement metric for social media stocks.Second, worry about how appleThe iOS privacy changes could affect companies that rely on ad revenue, such as Pinterest.
But as I said in March, Pinterest doesn’t care about these issues.
The company’s decline in MAU can be explained by rising vaccination rates and people returning to normal (and spending less time online). What’s more, Pinterest has no trouble monetizing its 433 million monthly active users. Despite a 9% year-over-year decline in MAU, global average revenue per user increased by 28%! This is everyday evidence that merchants are willing to pay to reach Pinterest users.
What’s more, Pinterest’s entire platform is based on the idea that users openly share the things, places, and services they’re interested in. Its MAU gives merchants all the tools they need for targeted advertising, Making Apple’s iOS privacy changes a point of contention.
Image credit: Getty Images.
visa
Another incredible growth stock with a rich history for shareholders is the payments processing leader visa (V 0.84%).
The reason Visa’s stock is about 20% below its 52-week high has to do with the growing likelihood that a recession will hit U.S. and/or global markets. That’s usually bad news for cyclical companies that rely on consumer and business spending. Such concerns, however, ignore Visa’s many competitive advantages.
first, Cyclicality is not a bad thing. While recessions are inevitable, they usually last only a few quarters. By contrast, expansion periods are usually measured in years. As such, Visa is a company that allows patient investors to benefit from the natural expansion of the U.S. and global economies over time.
It’s also a no-lending company. Strict adherence to payment processing means companies don’t have to worry about loan delinquencies/losses during a recession. Not having to set aside money for losses is a key reason Visa’s profit margin is consistently above 50%.
One final note: Visa accounts for the majority (54%) of credit card network purchases in the U.S., the world’s largest consumer market.it is Buy without hesitation on any major weakness.
Image credit: Getty Images.
public school
small cap ad tech stocks public school (public broadcaster 1.32%) is another extraordinary growth stock that investors can confidently add to their portfolio.
With inflation soaring and the Federal Reserve hitting the proverbial brakes by raising interest rates, there are fears that a U.S. recession will lead to a significant pullback in corporate ad spending. That’s not ideal for a sell-side platform that helps publishing companies sell their digital display space.
But like the other companies on this list, concerns surrounding PubMatic’s near-term future appear to be completely overblown. For example, even as U.S. gross domestic product fell 1.4% in the first quarter, PubMatic’s revenue was up 25% from a year earlier. As businesses shift their advertising dollars from print to digital, PubMatic has a good chance of doubling the global digital advertising growth rate to just over 10% per year.
Another point worth noting about PubMatic is that the company Design and build its cloud-based infrastructure. Not having to rely on third parties in the programmatic advertising space is a huge advantage that will allow PubMatic to recognize greater efficiencies as it scales. Or, to put it more simply, it should have higher profit margins as revenue climbs.
PubMatic has a sustained growth rate of about 25% and a forward P/E ratio of just 22 looks like a bargain.
Image credit: Getty Images.
letter
last but not least, FAANG stocks letter (Google -1.34%)(Google -1.29%) is an amazingly fast-paced stock that can make patient investors even richer.
Like other companies on this list, the prospect of a recession looms. A large part of Alphabet’s business — Alphabet is the parent company of internet search engine Google and streaming platform YouTube — relies on advertising. As mentioned earlier, when the economy contracts, merchants tend to scale back advertising.
However, Alphabet is not your average advertising company. For example, Google has controlled between 91% and 93% of global Internet searches for the past two years. With a veritable monopoly in search, Alphabet’s Google has impressive ad-pricing power. Not surprisingly, this is a segment that is almost always growing by double-digit percentages.
but the alphabet It’s not just Google these days. YouTube has become one of the most visited social networking sites on the planet, accounting for more than 10% of Alphabet’s revenue. Meanwhile, Google Cloud is the third largest provider of cloud infrastructure services in the world by spending. Google Cloud’s sales growth rate of 45% (or higher) should be a significant profit driver for Alphabet by mid-decade at the latest.
