Down More Than 25% in 2022: 3 Top Stocks Worth Buying This March

Down More Than 25% in 2022: 3 Top Stocks Worth Buying This March

These stocks have market-crushing potential and look cheap after big sell-offs.

With the highest inflation seen in decades, looming interest rate hikes, Russia’s invasion of Ukraine, and other market destabilizers, investors have had a dizzying array of risk factors to consider this year. Stocks could continue to see volatile trading in the near term, but big sell-offs have also made it possible to invest in great companies at much cheaper prices.

With that in mind, a panel of Motley Fool contributors has identified three top growth stocks that have fallen more than 25% across 2022’s trading and are worth pouncing on. Read on to see why they think these companies are primed to rebound and deliver big wins for investors. Image source: Getty Images. The stock may be falling, but this business is on the rise

Jason Hall : PubMatic ‘s ( PUBM 5.07% ) sell-side programmatic platform helps publishers maximize ad revenue, while advertisers and ad agencies maximize the return on their ad spend.

The proof that PubMatic’s platform is delivering is in the results. Through the third quarter of 2021, its organic revenue had increased 50% or more for four straight quarters. The number of advertisers spending $1,000 or more increased 40%, and over 60,000 advertisers placed ads on its platform in the quarter. And as advertisers come on the platform, they increase their spend; net dollar-based retention was an incredible 157%.

It’s not just empty revenue growth, either. Net income was up 118% in the quarter, a continuation of PubMatic’s trend of growing profits — and cash flows — since going public: Just looking at the stock price, you wouldn’t know PubMatic’s business was doing so well. Shares are down 26% in 2022, and a brutal 64% from the all-time high.

Can PubMatic continue the high-quality growth? I expect it can, with a wonderful platform that seems to have growing appeal to stakeholders on both sides of the ad business, a strong founder-led management team, and great tailwinds. Eventually, investors will catch on, and a wonderful growth stock like PubMatic will prove a rewarding investment.

It reports fourth-quarter results on Feb. 28, so expect more volatility to come. But investors should put it high on their list of stocks to buy in March. DraftKings is falling along with the broader sell-off of unprofitable growth stocks

Parkev Tatevosian : DraftKings ( DKNG 3.66% ) is having a rough start to 2022. The stock is already down 27% as of this writing. DraftKings offers consumers the ability to wager real money on daily fantasy sports, mobile sports betting, and iGaming. It’s rapidly growing revenue as more and more states are legalizing the aforementioned activities. Indeed, annual revenue increased from $192 million in 2017 to $1.3 billion in 2021. What’s more, the growth rate has accelerated for three consecutive years.

Management expects the momentum to continue and has forecast sales of $1.93 billion in 2022. DraftKings is now live with a mobile sports betting service in 17 states. Its iGaming app, which includes popular games like blackjack, is live in just five states. Legalizing mobile gaming activities is gaining favor with states because it increases tax revenue without the need to build brick-and-mortar casinos. Consumers like the mobile version better because of convenience; you can go from an impulse to a wager within seconds. Contrast that with the alternative of driving hours to reach your nearest casino.

Online gaming also has the potential to be more profitable. After all, you don’t need as much staff to operate an app and website as you would need to maintain a massive building. It also makes the company less exposed to cyclical downtrends; brick-and-mortar casinos still need to be maintained regardless of how many customers visit.

Interestingly, profitability, or lack thereof, is the primary culprit for DraftKings’ stock fall in 2022. The market is falling out of love with unprofitable growth stocks. DraftKings may be proliferating, but it is losing money on the bottom line, $1.5 billion in 2021, to be precise.

That said, the company is making excellent progress and offers investors a lucrative reward for the risk. Investors can feel good about adding DraftKings to their portfolios in March for those reasons. Get a piece of the gig-economy revolution

Keith Noonan : With valuations for growth-dependent companies coming under pressure and Fiverr International ‘s ( FVRR 3.84% ) sales growth slowing amid challenging bases of comparison and the easing of some pandemic related tailwinds, investors have sold the stock in droves. The gig-marketplace specialist’s share price has fallen 36% […]

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