Technology investors have had a difficult year in 2022, but here are opportunities worth considering in this bear market.

A bear market is defined by a decline in the value of a financial asset or index of 20% (or more). Right now, the Nasdaq-100 technology index is down by 29% in 2022 so far, and if the year ended here, that would be its worst performance in the last decade. In fact, it would be the steepest annual drop since the 2008 global financial crisis.

But it doesn’t have to be all bad news for investors. Bear markets tend to result in broad-based selling, which means many quality stocks get tossed aside — and that spells opportunity for investors willing to put money to work, especially with the long term in mind.

A panel of Motley Fool contributors have identified Datadog ( DDOG 9.01%), Pinterest ( PINS 5.82%), and Arista Networks ( ANET 0.54%) as three stocks to buy in the thick of this bear market. Here’s why. A critical cloud monitoring tool, and an optimistic tone

Anthony Di Pizio (Datadog): When it comes to trawling this bear market for quality opportunities, a company that has raised its 2022 sales guidance for three straight quarters might be a great place to start. Cloud computing has opened countless doors for businesses small and large, because it enables them to shift their operations online and it creates more touch points with customers without the need for additional physical stores.

But a business might find it challenging to monitor the performance of, or draw insights from, its expansive online presence. That’s where Datadog comes in — whether it’s entertainment, healthcare, gaming, or retail, Datadog’s platform is designed to rapidly alert businesses to technical issues for the fastest possible resolution.

Some problems might be almost invisible under normal circumstances; a particular webpage might be loading too slowly, or a specific customer segment in one geographic location might have trouble accessing the business’s website. In any case, it’s Datadog’s job to shine a light on those glitches so they’re quickly picked up.

The company just reported its financial results for the third quarter (ended Sept. 30). It grew its revenue by an eyewatering 61% to $437 million, prompting a raise in its full-year guidance to $1.654 billion at the high end of the range. It follows upward revisions in the first and second quarters, and Datadog is one of only a few companies with such an optimistic tone in this difficult economic environment. Many companies are actually slashing their forecasts instead .

Much of Datadog’s growth is coming from large organizations, which makes sense because the bigger the business, the more reliant it would be on cloud-based infrastructure. In Q3, Datadog had 2,600 customers spending a minimum of $100,000 annually, marking a 44% jump year over year.

With Datadog stock down 61% from its all-time high, this might be one that was prematurely thrown out. That’s an opportunity for investors who buy now. A superior social media stock down big

Jamie Louko (Pinterest): Investors have smashed the dislike button on social media stocks, as many are struggling to retain users and have seen advertising revenue fall off a cliff. Take Meta Platforms ( META 1.68%), for example. In Q3, revenue fell 4% year over year, and monthly active users increased by just 2% over the same period.

Pinterest, however, is bucking this trend. It has struggled over the past year, but the company looks like it’s coming out the other side of the tunnel . The social media platform saw sequential user growth of 12 million in Q3, to 445 million monthly active users.

The company also grew monetization faster than its social media rivals in Q3. Snap ( SNAP 3.27%) saw global average revenue per user (ARPU) drop 11% compared to the year-ago quarter, to $3.11. Comparatively, Pinterest increased its global ARPU by 11% over the same period, to $1.56. Snap’s ARPU excluding North America and Europe also fell 9%, but Pinterest’s ARPU in the same region skyrocketed 38% to $0.11.

How can Pinterest continue to attract ad spending while rivals are struggling? CEO Bill Ready said it best on the company’s Q3 earnings call : Pinterest is a unique place for advertisers because our users seek inspiration and discovery with intent and purpose. This has a number of implications. To begin with, we have on-platform, first-party signals like searches, saves, and board curation that translate into highly valuable and monetizable customer insights for advertisers. This isn’t coming at the expense of profits, […]

source 3 Growth Stocks to Buy In the Worst Nasdaq Bear Market In 10 Years

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