These are not winning shares that you can take with you. The following trio of great stocks is 33% – if not more – away from their 52-week high and should be bought by investors hand in hand.
The first winning stock to outperform the latest is technology-driven real estate company Redfin (NASDAQ: RDFN). Redfin’s shares have nearly halved since mid-February.
When the Federal Reserve spoke of the possibility of taking off its foot on the gas with its bond purchasing program and raising interest rates in 2022 and 2023, mortgage rates were expected to rise. The clear and obvious worry is that higher mortgage rates would cool the red-hot housing market. I think overweighting the rise in mortgage rates would underestimate the change we see in property sales.
Redfin: Down 51% from its 52-week high
Redfin is changing the real estate landscape in two ways. First, it puts more money in the pockets of buyers and sellers.
Traditional estate agents charge commissions and list fees of between 2.5% and 3%.
According to Redfin, the national median price for home sales in August was $380,271. Based on a two percentage point saving, Redfin sellers hold on to a median of $7,600.
During the pandemic, Redfin supported buyers and sellers with 3D virtual tours. A concierge service charges a fee to help sellers stage and modernize to maximize their homes’ sale price. But the RedfinsNow service could make the difference.
At the end of 2015, Redfin’s shares in existing US home sales tripled from $0.44 to $1.18. This is a good indication that the company will continue to deliver to investors for a long time to come. The service is offered in select cities, and Redfin now buys homes for cash, eliminating the haggling and haggling over the sale of a home. Another profitable stock is leading Chinese Internet search engine provider Baidu (NASDAQ: BIDU). Shares in the 52-week high have fallen 55% from their 52-week high, providing the perfect opportunity for investors to buy the stock with their fists.
Investing is about creating wealth or consuming wealth, depending on how you invest. If your goal is the former, strengthen your finances, not weaken them.
You can give yourself the best chance of investing success by sticking to tried and tested tactics. Invest in quality companies you have held for decades, stay diversified, and keep cash in an emergency fund. Avoid complex investment strategies, no matter how trendy or famous they may seem.
You can buy them all for less than $49 a share. Click here to find out how to get your copy of 5 Growth Stocks for $49 for a limited time for free. This prominent growth figure has lost 55% of its value in just seven months.
The answer lies in tightening regulations on technology stocks and select industries in China. China, for example, hit its leading e-commerce company Alibaba with a record $2.8 billion antitrust fine in April.
Baidu: Down 55% from its 52-week high
On the other hand, as indicated above, Baidu is also in the crosshairs of Chinese regulators. Innovative Chinese tech companies are seen by regulators as potential targets, making investors skeptical of imposing a high valuation multiple on the company. While the policy for Chinese equities may be a primary concern compared to those holding shares in US companies, the company’s long-term growth prospects more than outweigh any short-term concerns.
In China, Baidu is the undisputed leader in Internet search. Globalstar data shows that it has held between 67% and 80% of the share of internet searches in the country in the last 12 months. In short, it means that no matter what happens, it is the clear path for advertisers who want to reach consumers.
Non-marketing revenues accounted for 16% of total revenue in the June quarter and grew 80% year-on-year. If China maintains its rapid growth rate, Baidu’s marketing revenues could rise by double-digit percentages. Even more exciting than Baidu’s “core business is its investment in cloud services and artificial intelligence (AI). Artificial intelligence is a growing opportunity, especially given its role in the next generation of cars.
Investors have the chance to buy a profitable share with double-digit sales growth potential with a price-earnings ratio of only 1.4. Baidu offers just that.
Vertex Pharmaceuticals: Down 33% from its 52-week high
The Biotech specialty Vertex Pharmaceuticals (NASDAQ: VRTX) has lost a third of its value since reaching a 52-week high. If you’re wondering why Vertex has become chubby lately, look at two failed clinical trials of alpha-1 antitrypsin deficiency (AATD).
VX-864 was discontinued in June 2021 after the company warned that it was unlikely to demonstrate significant clinical benefits in large-scale trials. Last October, Vx-814 was suspended in a clinical trial due to elevated liver enzymes in some patients. The failure of these two clinical studies does not negate the company’s incredible success in developing several generations of treatments against CF.
In total, Vertex developed four generations of gene-specific CF treatments, with the newest, Trikafta, reaching in less than two years an annual mileage of $5 billion on the shelves of pharmacies. But Vertex is not content to be the leader in one indicator.