4 Growth Stocks Down 20% or More to Buy Right Now

The recent market sell-off has created a unique opportunity for investors to scoop up growth stocks at discounted prices. With the market in flux, several high-potential companies have seen their valuations drop significantly, presenting a compelling case for long-term investment. Let's dive into four growth stocks that have fallen by 20% or more from their highs and why they could be excellent additions to your portfolio.



Amazon (AMZN)

Amazon has seen its stock price drop by over 20% from its highs, trading at a trailing price-to-earnings ratio (P/E) of around 34. Despite this decline, the company continues to show strong growth, with revenue increasing by 10% last year and adjusted earnings per share (EPS) soaring 91%. Amazon Web Services (AWS), the company's cloud computing arm, has been a significant growth driver, helping customers create and deploy AI models and apps through services like Bedrock and SageMaker. Additionally, Amazon has developed its own custom AI chips to improve performance and lower costs, positioning itself as a long-term AI winner.

Alphabet (GOOGL, GOOG)

Alphabet, the parent company of Google, has seen its stock price fall by about 25% from its highs. Investors are concerned that AI chatbots like ChatGPT could displace Google's dominance in search. However, Google Search remains superior in gathering real-time information and sourcing materials. Moreover, Alphabet has a significant opportunity to monetize more search and AI queries in the future, given that it traditionally serves ads on only about 20% of its search queries. The company's diverse portfolio, which includes Prime Video, the third-largest cloud computing platform, and Waymo's robotaxi business, further supports its potential for future growth.

Cava Group (CAVA)

Cava Group, a Mediterranean fast-casual restaurant chain, has seen its stock price drop by nearly 50% from its highs. Despite this decline, Cava has one of the hottest concepts in the quick-service space and a huge expansion opportunity. The company's recent same-store sales results soared 21.2% last quarter, driven by menu innovations and digital marketing efforts. Cava plans to open between 62 and 66 new locations in 2025, presenting an attractive buying opportunity for long-term investors.

Eli Lilly (LLY)

Eli Lilly, a pharmaceutical company, has seen its stock price drop significantly from its highs. The company's business momentum is driven by Mounjaro and Zepbound, two formulations that treat diabetes and obesity, respectively. Both drugs are versions of the compound tirzepatide, a GLP-1 receptor agonist. Eli Lilly has invested billions in production capacity to address shortages and has completed clinical trials showing its Zepbound treatment is more effective for weight loss than Wegovy. With a strong growth outlook and a robust pipeline, Eli Lilly is poised for long-term success.

Conclusion

The recent market sell-off has created a unique opportunity for investors to buy growth stocks at discounted prices. Amazon, Alphabet, Cava Group, and Eli Lilly are four companies that have seen their stock prices drop significantly but continue to show strong growth potential. By investing in these companies, long-term investors can capitalize on their growth prospects and position themselves for future success.