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The current economic landscape, characterized by escalating uncertainty and rising interest rates, poses significant challenges for growth stocks.
Investors in growth-oriented companies have felt the effects of a stock market downturn, primarily driven by U.S. trade strategies and the ensuing global market reactions. Many firms are grappling with substantial obstacles stemming from ongoing economic volatility. Nevertheless, insightful long-term investors understand that capitalizing on robust businesses during turbulent market conditions is a strategic approach to wealth accumulation.
Where to invest $1,000 right now? Our analysis team has identified the 10 most promising stocks to consider investing in today. Continue »
Among current opportunities, three stocks represent particularly compelling prospects for investors.
Coupang (NYSE: CPNG) has emulated the operational strategy of Amazon in the South Korean market. With a network of over 100 fulfillment centers, Coupang guarantees that more than 99% of its orders are delivered within 24 hours.
This efficient logistics system enhances the appeal of its Wow membership, which provides customers with free shipping on orders and offers food delivery services similar to those of Uber Eats, alongside Coupang’s streaming video options. The expansion of Wow membership not only attracts customers but also entices third-party sellers and restaurants, thereby fueling high-margin revenue growth within its marketplace.
Coupang’s growth strategies include its recent entry into the Taiwanese market in 2022, where it has seen strong performance. The launch of the Wow membership in Taiwan is expected to lead to faster breakeven than was achieved in South Korea. Additionally, the acquisition of Farfetch has enabled Coupang to venture into luxury fashion. The company is also considering expansion into digital advertising, a sector that has become a lucrative revenue stream for many e-commerce businesses, especially Amazon.
Management anticipates consistent revenue growth while increasing its EBITDA margin from 4.5% in 2024 to more than 10%. The company aims to enhance supply chain efficiency and achieve operational leverage while expanding its presence in Taiwan and its food delivery service. Such initiatives are projected to contribute positively to earnings growth.
Currently, Coupang’s stock trades at an enterprise value to forward EBITDA ratio below 23, positioning it advantageously compared to its historical valuation. With significant long-term earnings growth potential, it may be an opportune time for discerning investors to consider acquiring shares.
In the digital advertising landscape, marketers often consider platforms like Facebook or Google, which, despite their popularity, are limited to singular advertising channels. The Trade Desk (NASDAQ: TTD) offers a comprehensive solution that enables advertisers to optimize campaigns across diverse media, including streaming video and podcasts.
Utilizing advanced machine learning algorithms, The Trade Desk enhances the effectiveness of advertising campaigns. It leverages both advertiser data and third-party insights, paired with its own historical information, providing it with a significant competitive advantage. This capability allows the company to justify premium rates to advertisers by maximizing the efficiency of their marketing budgets.
After a disappointing earnings report in February, The Trade Desk’s stock experienced a notable decline, a situation worsened by tariff introductions affecting the advertising sector. CFO Laura Schenkein emphasized that the earnings shortfall was not due to market competition but rather internal execution challenges. Moving forward, the company aims to harness growth opportunities by increasing operational expenditures.
Although this may impact short-term earnings, The Trade Desk maintains substantial long-term operating margin expansion potential. Operating as a software firm, it benefits from low fixed costs and a gross margin in the 80% range, indicating a trajectory toward improved profitability as it scales.
Despite the recent downturn, The Trade Desk still commands a premium valuation, trading at an enterprise value to expected sales multiple of 8.6. This valuation is considered justified, given the company’s competitive position in a burgeoning market and its ability to enhance profit margins substantially over time.
As enterprises increasingly integrate various software solutions, they often encounter challenges related to disparate data silos. Datadog (NASDAQ: DDOG) excels at unifying this data, presenting it to clients through an intuitive dashboard that simplifies system monitoring.
The data observability sector is rapidly expanding, fueled by the rising demand for data-driven decision-making and cloud computing solutions. Datadog has effectively employed a land-and-expand strategy, allowing it to grow its service offerings beyond observability to include cloud security and management, thereby enhancing revenue streams.
Currently, Datadog enjoys a high revenue retention rate, with 50% of its clientele utilizing four or more services, a clear increase from previous years. Switching from one observability provider to another entails considerable costs and risks, further encouraging client loyalty.
Additionally, Datadog has introduced user-friendly features, such as the Bits AI chatbot, to facilitate interaction with data, further solidifying its value proposition within corporate environments.
The stock’s enterprise value stands at roughly ten times analysts’ revenue projections for 2025. While not the most affordable option, its impressive growth forecast, with anticipated sales increases around 20% annually, suggests promising profitability potential driven by the leverage inherent in its software business model.
Before making a decision to invest in Coupang, it is essential to weigh the following:
The Motley Fool Stock Advisor analyst team has highlighted their selection of the 10 best stocks to buy now… and Coupang was not included. The stocks on this list have strong potential to yield significant returns in the foreseeable future.
For context, consider that Netflix made the list on December 17, 2004… an investment of $1,000 at that time would now be worth $594,046!* Similarly, if you had invested $1,000 in Nvidia when it was recommended on April 15, 2005, it would have grown to $680,390!*
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*Stock Advisor returns as of April 21, 2025
John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, serves on The Motley Fool’s board of directors. Adam Levy is invested in Amazon. The Motley Fool holds positions in and endorses Amazon, Datadog, The Trade Desk, and Uber Technologies. The Motley Fool also recommends Coupang. For more details, refer to their disclosure policy.
Stock Market Sell-Off: 3 No-Brainer Growth Stocks to Buy Right Now was originally published by The Motley Fool
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