When the stock market falls sharply, the shares of many great companies often go on sale. That has happened in spades lately. The stock market, as measured by S&P 500It recently dropped about 21% from its 52-week high – while many stocks have seen their usual implode by 50%, 75%, and perhaps even more.
Here are three companies in which you want to invest, now that the stock is at a lower level than it has been for a long time.
Mike (NO 6.63%) is “the world’s leading designer, marketer and distributor of authentic athletic footwear, apparel, equipment and accessories for various sports and fitness activities”. That’s no surprise to most of us. You might be surprised to learn that the venerable Converse brand is now part of Nike, though.
Nike faces competition from companies such as Adidas and New Balance, and is challenged by supply chain issues, as are many other businesses. And sales in a key market, China, are under pressure due to pandemic lockdowns. But Nike still has a very valuable brand — it ranks 10th in the world with an estimated value of $41 billion, per person at Interbrand.
Investors balked at Nike’s first quarter report, which revealed inventory piles up. But the report was not a total bust, with both revenue and earnings exceeding analyst expectations. Nike shares have fallen 47% from their 52-week high, and price-to-earnings ratio (P/E). from 27, considerably less than the five-year average of 47, the stock is more attractively priced than it was a few months ago.
until, it’s not a bargain-basement price, so if you believe in Nike’s growth potential, you can buy it incrementally over time, hoping for some lower entry points. Or you can add it to your watch list, waiting for a more interesting time to “just do it” and buy.
Comcast (CMCSA 3.81%) has become a massive media and technology company – focused primarily on connectivity, aggregation, and streaming and with a recent market value topping $135 billion. You may not be aware, but its businesses and brands include Xfinity, Comcast Business, Sky, Universal Filmed Entertainment Group, Universal Studio Group, Sky Studios, broadcast networks NBC and Telemundo, several cable networks, Peacock, NBCUniversal News Group, NBC Sports. , Sky News, and Sky Sports — not to mention Universal Parks and Resorts.
Comcast’s recently reported third quarter featured a 1.5% decline in year-over-year revenue. But free cash flow grew by 4.7%, while adjusted net income rose 4.5% and net cash from operating activities jumped 13.9%. The company is investing in growing his peacock streaming services, and theme parks are doing well.
Some worry about slow growth in broadband and people continue to cut the cable in favor of streaming services, but others see opportunity if Comcast sheds some businesses and invests in more fast-growing, such as wireless and theme parks.
Shares of Comcast recently fell 42% from their 52-week high, which pushed the forward P/E ratio to 8.2 from its five-year average of 14.5. And as is often the case, when stock prices fall, dividend yields rise — and Comcast shares recently yielded 3.5%.
3. Sundanese script
Sundanese script (GOOG 2.72%) (GOOGL 2.63%) is a widely admired powerhouse, with a recent market value topping $1.1 trillion and a brand ranked No. 4 in the world (by Interbrand) with a value of almost $252 billion. That’s not enough to keep the stock afloat in these volatile days, though. Alphabet shares have recently fallen nearly 42% from their 52-week high, one shows Interesting entry point.
Remember that Alphabet is much more than the dominant search engine Google. Its universe includes the widely used Android mobile operating system, and YouTube, and Google Cloud. YouTube itself is a very valuable asset, with users reportedly watching more than a billion hours of content a day and YouTube ads just delivering 10% of total revenue. Alphabet also owns the Google Play app store, smart thermostat maker Nest, and Fitbit, among others. Google ads still generate most of its revenue, though – fully 79% in the third quarter of 2022.
CEO Sundar Pichai recently noted: “We are training our focus on a clear set of products and business priorities. The product announcements we have made in just the past month alone have shown that very clearly, including significant improvements for both Search and Cloud.” Powered by AI, and a new way to monetize YouTube Shorts.” CFO Ruth Porat noted, “We are trying to realign resources to fuel our highest growth priority.”
There are many attractive growth stocks to consider for your long-term portfolio, and this is a great time to hunt them down, as they fall to more attractive levels.
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Selena Maranjian have a position in Alphabet (A stock) and Alphabet (C stock). The Motley Fool has positions and recommends Alphabet (A stock), Alphabet (C stock), and Nike. The Motley Fool recommends Comcast. The Motley Fool has disclosure policy.