Key Points

  • Pinterest shows social media doesn’t have to revolve around news and toxicity.
  • Catalent is a drugmaker with several high-demand ways to generate revenue.
  • Shopify helps evolve e-commerce, empowering businesses.

Just because a stock’s is at a low, doesn’t mean it’s a buy. Sometimes you should trust that the market knows what it’s doing. On the other hand, great stocks at record lows are of obvious interest.

That’s what happened with these three great growth stocks. Here’s a closer look at these stocks, each of which is not only at or near new 52-week lows, but are also below previous highs.

Shopify

Looking back, it isn’t too surprising that Shopify shares (NASDAQ:SHOP) dropped from November’s peak near $1,763 to a current price of $660. A big piece of that loss took shape just last week. When a pandemic hit, the stock rose to an unsustainable price as millions of people and businesses flocked to the internet. Shopify shares were approximately $360 when the pandemic first arrived in the United States.

Last week’s announcement that the e-commerce support firm plans to spend significantly to enhance fulfillment capabilities added to the existing selling pressure. Investors hope for continued profitability improvement, rather than being crimped from here on out.

However, lost in the shuffle is that these investments will pay off handsomely in the future. Shopify’s growth doesn’t translate into a crisis for Amazon (NASDAQ:AMZN) or any other e-commerce platform. But, it would be naive to think Shopify’s model isn’t working.

The firm already provides millions of small and not-so-small firms with the tools they require to construct and manage their own internet selling platform. The capacity to handle more logistics work will provide a significant financial advantage as the firm expands subscription-based services to its clients. Merchant solutions revenue surpassed $1 billion in the last quarter.

This leads analysts to believe that Shopify will see top-line growth of 31% this year. In addition, they expect profit growth to soar more than 33% next year.

Catalent

Catalent (NYSE:CTLT) isn’t a well known name. However, there’s a good chance you, or someone you know, uses its products. This firm produces a variety of prescription medications and personal care items, as well as being a contract manufacturer for several different drugs. Gene therapy and biologics are within its wheelhouse, but so are things as basic as cosmetics and nutritional supplements.

Like Shopify, Catalent shares soared for most of the pandemic. Similarly, the stock paid the price for what was clearly excessive buying. Catalent shares dropped more than 30% since its peak in September, and staying below lows established last year. In fact, the stock is only a few dollars away from falling below its previous 52-week low made just last month.

Don’t be scared off by a little weakness, it’s more of a buying opportunity than a signal. The business’ profit centers are widespread and diverse. Catalent does it all, from over-the-counter chewables to drug trial assistance to producing prescription capsules, for an industry that never slows down.

Analysts believe this year’s anticipated 20% rise in sales will push per-share earnings up from last year’s $3.04 to $3.68. Not bad at all, and currently one of the best stocks at a record lows.

Pinterest

Add Pinterest (NYSE:PINS) to your list of growth stocks that have unjustifiably tanked in just the past few weeks. The stock has plummeted almost 70% since the middle of last year, and appears to be continuing the fall.

That’s a somewhat understandable sell-off in light of similar losses experienced by other social media names, like Meta Platforms (NASDAQ:FB) and Twitter (NYSE:TWTR). Social networking is arguably, too big to manage. It has become too toxic for many of its users and many of its much-needed sponsors. Pinterest is unjustifiably included in this group.

Pinterest is a lucky beneficiary of the downfall of social media’s giants, such as Twitter and Facebook. Consumers are weary of the never-ending political bickering, overwhelming news feeds, and increasingly picky engagement rules that have all become the norm of traditional social media. A large amount of them are now looking for something simpler and more hospitable.

That’s describes Pinterest perfectly. On pinterest.com, you can “pin” items that interest you to your personal page and subsequently share these pins with a like-minded community. There’s no real way to have an online quarrel on the page.

Since the middle of last year, this distinction hasn’t made much of a difference to investors. However, the company continues to refine its product and platform. Investors are apt to take notice if and when it produces the sales growth analysts expect. Predicted growth is 21% for this year, and 26% for next year. Earnings growth should also grow at that pace. Keep your eye out for these great stocks at record lows.

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