It has been a rough year for Wall Street, where major stock indices slumped to their lowest levels not seen in decades. However, amid the recent signs of economic recovery and easing inflation, the equity market has gradually begun to rebound.
Now is the time for investors with a long-term outlook to purchase some prominent stocks at discounted prices. Here, we have listed the five best stocks to buy now on the dip considering their future growth potential.
Established in 2005, Etsy is an online e-commerce marketplace where independent artists can market and sell their goods. The company mainly focuses on selling handmade items, collectibles, vintage furniture, clothing, and many other crafts.
Like the majority of the stock market, Etsy has been grappling with tough economic winds for the last 12 months. Currently, its stock is almost 42% down year-to-date due to the lessening purchasing power of consumers.
However, Etsy exhibits the potential to grow immensely over the long term. The company specifically focuses on the personalization feature whereas no other online marketplace offers this scale of customization service to buyers. The merchants at Etsy are generally sole traders and micro-enterprises who cooperate with the customers personally and accommodate their needs.
Moreover, as per the Etsy Shopper Stats: March 2022, out of the 90 million active buyers that visited the marketplace in 2021, there were 36.3 million repeat buyers, a 121% increase since 2019. The company defines these “habitual/repeat buyers” as the ones who spend $200 or more and make purchases on six or more days in the trailing 12 months.
Etsy Inc. also has a record of re-investing the cash to improve the platform’s functionality to enhance user experience. With such a competitive edge, ETSY is a good bet for investors who have a long-term investment approach.
Zscaler is a California-based IT security company that offers cloud security and cloud migration services. The company’s central project, Zero Trust Exchange, ensures the security of customers from cyberattacks and prevents data loss by securely linking devices & applications with users.
Similar to other technology stocks, ZS has been suffering from the broader economic crisis since the last year. The stock has lost more than 58% in value till now after peaking back in November 2021.
However, Zscaler incorporates an outstanding future potential whereby it can dramatically grow in the coming years. Its Zero Trust project is the biggest catalyst capable of pushing growth in line with the increasing cloud adoption. This technology is based on the code that all interactions with an organization’s digital components are hostile. It, therefore, analyzes the location, device, and role of all employees, without any exception, to identify the potential threats at their very roots.
Moreover, things are already looking better for this cybersecurity company as its latest Q4 report indicates a 61% revenue growth and 57% billings growth year over year.
Zscaler stands as one of the top stocks to buy today as the company exercises operational efficiency by offering innovative and advanced services integrated into its Zero Trust security platform.
3. Walgreens Boots Alliance
Walgreens Boots Alliance is a retail pharmacy leader that manages several pharmaceutical manufacturing and distribution companies. WBA stock is almost 21% down year-to-date but is showing signs of recovery as the company develops healthcare services business.
The Walgreens stock is currently trading at a lower valuation which indicates its room for future growth. Moreover, the corporation is gearing up to enhance its digital presence and create more healthcare platforms to generate more revenue. WBA’s status as a “Dividend Aristocrat” can also not be ignored as it offers a yield rate of nearly 5.5%, significantly higher than the average dividend yields of most stocks and the current US-Treasury yields.
Walgreens Boots Alliance might be one of the best stocks to buy now at the dip, as Cowen upgraded WBA status to Outperform from the previous Market Perform this Tuesday. The investment research company pushed up its price target on the stock to $54 from $43.
4. Advanced Micro Devices
Advanced Micro Devices is a leading name in the semiconductor industry. The company manufactures computer processors and graphic technologies for the consumer and business sectors. The AMD stock is currently down nearly 50% year-to-date but integrates notable potential to reach double figures in the coming years.
Firstly, Advanced Micro Devices holds the status of being the most diverse and highest-degree semiconductor producer in the industry. It offers its services to many prominent tech giants, including Tesla, Alphabet, and Amazon besides making hardware for Sony and Microsoft. Coupled with its acquisition of Xilinx, a semiconductor company focusing on programmable logic devices, this year, AMD stands as one of the most promising stocks to buy today.
According to AMD’s recent quarter report released on November 1, its Data Centre, Gaming, and Embedded segments showed significant year-over-year growth whereas Client segment revenue was lower than expected. That said, the company’s greatest opportunities over the long run probably lie in the Data centre, particularly when it is the main force behind adaptive technologies.
Shopify is a multinational e-commerce company that allows businesses to create online stores and sell products via its proprietary e-commerce platform, also named Shopify.
The company has strongly suffered from higher inflation and bleak economic crosswinds over the last 12 months, showing a decline of more than 75% YTD.
However, from a bigger perspective, Shopify is still the e-commerce software leader with a very strong footing. According to the Oberlo data, online sales are expected to continue surging and make up a larger portion of retail sales over the coming years. By 2026, it’s estimated that world retail e-commerce sales will surpass $8.1 trillion and the overall e-commerce share of retail sales will hit 24%. This outlook notably solidifies Shopify’s position in the future.
Moreover, the company recently incorporated business-to-business (B2B) tools into Shopify Plus, allowing the merchants to sell D2C and B2B from the same platform. This integration is a positive development for Shopify considering the expanding B2B market.
Consequently, SHOP might be one of the best stocks to buy now as it is currently trading at a highly discounted price relative to its sales and actual valuation.