Value investors are always in search of undervalued, growth stocks that could supercharge their portfolios. However, finding those stocks among thousands of them is quite challenging as it requires analyzing hundreds of stocks individually. Thankfully, you don’t have to toil hard to find and analyze such stocks by yourself as we have created a list of the top 5 undervalued growth stocks that you can consider buying now.
PayPal
PayPal, the American fintech company, has so far lost around 60% since the start of the year 2022. Over the past 12 months, the stock has lost around 70% of its value. At the moment, the stock is trading at its lowest levels since 2016. But does this mean that there is something wrong with the company or does it mean that the stock is on sale?
After enjoying stellar growth on the back of the pandemic in 2021, the company’s earnings have been somewhat subdued as it lowered its revenue growth estimates for 2022 to 15% from 17%. Its net income declined by 54% to around $509 million in the first quarter of 2022 compared to the same quarter last year.
Salesforce
Salesforce, the cloud-based CRM software company, lost around 35% of its value since the start of 2022. The company is considered a growth company, but the recent fall in its price has created doubts in the minds of investors. Analysts believe that the rising interest rates have prompted many investors to turn away from riskier assets such as stocks, resulting in the decline. Also, the S&P 500 index is undergoing correction with a decrease of around 17% since the start of the year. Growth stocks such as Salesforce are one of the prime victims of market correction. The company posted excellent Q4 2022 and FY 2022 results with a 26% year-over-year rise in quarterly revenue, which suggests that there is nothing fundamentally wrong with the company.
Abode
Adobe is another growth stock that has been performing consistently well and generating an average annual revenue growth of around 21% for the past several years. The net income of the firm also witnessed the similar trend over the past few years.
However, the stock remained under pressure, losing around 30% since the start of the year, which was broadly in line with the fall in the S&P 500 index. Given the strong results over the years, Adobe is trading at a discount after its recent plummet, which provides a great buying opportunity for value investors.
Walt Disney
At the time of writing, Walt Disney stocAt the time of writing, Walt Disney stock lost around 30% of its value since the start of year, dropping from around $160 to $106 per share. In contrast, the S&P 500 index lost around 17% during the same period. However, the company recovered smartly from the pandemic and has been able to get back on a growth trajectory. In its Q1 2022 results, it beat analysts expectations, and its revenue jumped by 34.3% year over year. The company stock is undervalued with plenty of upside growth potential, which is a positive sign for value and growth investors.k lost around 30% of its value since the start of year, dropping from around $160 to $106 per share. In contrast, the S&P 500 index lost around 17% during the same period. However, the company recovered smartly from the pandemic and has been able to get back on a growth trajectory. In its Q1 2022 results, it beat analysts expectations, and its revenue jumped by 34.3% year over year. The company stock is undervalued with plenty of upside growth potential, which is a positive sign for value and growth investors.
ServiceNow
ServiceNow, the American SaaS giant, also followed the similar trend. The stock has so far declined by around 32% since the start of the year. The company’s revenue grew at an average cumulative rate of around 33% between FY 2016 and 2021, and it expects to keep it at 20% until 2026. The company is a decent growth stock available currently at a steep discount given the recent fall in its stock price.
