It’s been a really difficult year for Wall Street professionals and ordinary investors alike.benchmark S&P 500It is often viewed as a barometer of stock market health.
Things are getting worse for companies focused on growth NASDAQ Composite (^IXIC -3.80%)has lost 34% of its value since closing at a record high in November and is now in a definitive bear market. Companies that have led the broader market for years now have the responsibility of putting pressure on the market.
But there is good news. Where there is fear on Wall Street, there is also historical opportunity. As time went on, the double-digit percentage declines in all major US indices, including the Nasdaq, were put in the rearview mirror by the rally of the bull market. The current bear market ultimately shared this fate you will have to
Here are five great growth stocks you’ll regret not buying during the Nasdaq bear market.
The first extraordinary growth stock that investors can confidently grab when the Nasdaq bear market is down is theme park operator and content giant. Walt Disney (DIS -2.88%)If you’re wondering why Disney qualifies for the growth stock list, just look at Wall Street’s 13% annual revenue growth forecast for the company through mid-decade.
What makes Walt Disney a magical company for investors is the ability to engage and connect with people of all ages. Its theme parks bring families and friends together, while its movies and unique content allow grandparents and grandchildren to live in the same dream. Few companies have the capability. This cannot be imitated by other entertainment companies.
Another selling point is the incredible growth of streaming platform Disney+, which launched in November 2019. In less than three years, Disney+ has ballooned to over 152 million subscribers with his subscribers, demonstrating the power of Disney’s own content. For context, netflix It’s been over 10 years since the streaming platform launched and has over 150 million subscribers.
The prospect of a US or domestic recession is weighing on Walt Disney’s stock price, but the company’s long-term prospects remain bright.
If you want a growth stock, you’ll regret not buying it during the Nasdaq bear market, which is a little less prominent than Walt Disney. Consider cloud-based digital ad tech stocks. pubmatic (PUBM 0.22%)Advertising costs are the first to be adversely affected by a weakening US economy, but PubMatic appears to be well positioned to help long-term investors build wealth.
First and foremost, advertisers are steadily moving from print to digital advertising channels such as video, mobile, and over-the-top programmatic advertising (that is, advertising served on Internet-only media services). The digital advertising industry is expected to grow 14% annually through 2025. PubMatic, by comparison, has organic growth rates that mostly hover between 20% and 50%.
One of PubMatic’s advantages is that it is a sell-side provider (SSP). This fancy term means using a programmatic advertising platform to allow publishers to sell their digital display space. There is none. This has certainly helped the company’s organic growth rate outpace the sales trajectory of the industry as a whole.
Additionally, PubMatic built a programmatic cloud infrastructure rather than relying on a third party. As revenue grows, PubMatic must recognize higher operating margins than its peers.
A third notable growth stock to buy during the Nasdaq bear market plunge is China-based e-commerce stocks. JD.com (JD -3.39%)JD is uniquely positioned to thrive amid China’s rising economy, even as retail stocks take a hit from historically high inflation.
When most people think of online retail sales in China, the following probably comes to mind. Alibaba, a leading e-commerce provider. However, Alibaba’s platform is almost entirely based on third-party marketplaces. By comparison, JD’s marketplace is almost always built as a direct-to-consumer model. AmazonHaving JD handle both inventory and logistics will give the company more control over its operating margins and avoid the ire of Chinese regulators who have already cracked down on Alibaba.
But even more interesting are the ancillary opportunities for JD beyond e-commerce. This includes advertising, healthcare services and cloud computing. These other sales channels are not only growing at a faster pace than traditional online retail sales, but also have significantly higher margins associated with cloud services and marketing.
With JD’s share price more than halved in the past 20 months, it seems like the perfect time for patient investors to pile on.
innovative industrial property
Another great growth stock I didn’t buy during the Nasdaq bear market is cannabis-focused real estate investment trusts (REITs). innovative industrial property (IIPR -5.36%)Congress has been tight-lipped about attempts to pass cannabis reform, but the IIP, as revolutionary industrial property is better known, isn’t bad when it comes to wear and tear.
Like most REITs, IIPs aim to purchase properties that can be leased for the long term. If so, you are purchasing a medical marijuana growing and processing facility in a legalized state. By early September, the company had 111 properties in 19 states, spanning 8.7 million square feet of rentable space. IIP has collected his 99% of rents on time as of the end of June, and the company’s operating cash flow is highly predictable.
In addition to the above, cannabis has functioned like any commodity throughout the pandemic. increase. This suggests that demand for growing and processing facilities will continue to be strong, offering IIP many opportunities to expand its cannabis-focused real estate portfolio.
Innovative Industrial Properties’ sale/leaseback agreement has also played an important role in the company’s growth. As long as marijuana is federally illegal, access to the credit market will be spotty for cannabis companies. IIPs solve this problem by purchasing properties for cash and leasing the acquired facilities to the seller. This is a win-win scenario that puts cash in the pockets of cannabis companies and wins IIP long-term tenants.
The fifth and final epic growth stock I regret not buying during the Nasdaq bear market is a data mining firm Palantir Technologies (PLTR -3.78%)While this bear market is unsuitable for fast-paced stocks with expensive valuations, it shows that Palantir deserves a premium.
Perhaps the biggest reason to buy Palantir stock is that, like Walt Disney, it doesn’t have a replicable business model. Palantir’s artificial intelligence-driven Gotham platform assists government mission planning and data collection. The Foundry platform, on the other hand, is tasked with helping companies make sense of their data to streamline their operations. No other company can match the scale of Palantir.
For now, Gotham is Palantir’s shining star. Significant US government contract wins, often lasting four to five years, have enabled Palantir to achieve his 30%+ sales growth. But looking ahead, Foundry represents Palantir’s golden ticket.
Gotham is still expected to grow at a healthy pace, but ultimately its ceiling is capped by the fact that certain government agencies (such as China) are never allowed to use its software. . Meanwhile, the number of enterprise customers using Foundry more than tripled to 119 during the second quarter. Palantir has only scratched the surface with Foundry, but it should be able to sustain double-digit growth. long It’s time to come