The stocks you can’t ignore have cheap valuations, good growth rates and significantly higher price targets. These stocks are now very cheap in terms of valuation. Yet their growth rates are still intact.
ZipRecruiter (ZIP)
Zip Recruiter (NYSE:ZIP) is a very interesting stock in that its growth rate is high, but its valuation is not excessive. Moreover, the company is also buying back a large number of shares.
For example, the company’s Q4 2021 earnings showed that its earnings grew 93% year-over-year. Moreover, by Q1 its earnings rose by 81% YoY.
In fact, analysts now project earnings-per-share this year of 84 cents, up from 2 cents in 2021. And for 2023, the average forecast is for $1.21 per share, up 44% YoY. That puts ZIP stock on a forward P/E multiple of just 14x earnings, down from 20x of the 2022 earnings forecast.
Tripadvisor (TRIP)
Tripadvisor (NASDAQ:TRIP) is a profitable online travel company that claims to be the world’s largest travel site. It is also growing very quickly. But TRIP stock is not very expensive based on forecasts for earnings for 2023. Moreover, it is down 35% YTD and could be at a trough.
For example, its Q1 revenue was up 113% YoY. Moreover, its free cash flow finally turned positive in Q1. Tripadvisor reported that its FCF was now $72 million. Moreover, it now had about $738 million in cash and equivalents, as of March 31. That represents almost 30% of its market value.
As a result, analysts now forecast earnings will reach 79 cents per share this year and 105% more at $1.62 next year. That puts the stock on a forward multiple of 23.4x this year and 11.4x next year.
WiMi Hologram Cloud(WIMI)
WiMi Hologram Cloud (NASDAQ: WIMI) has been a favorite of growth investors, and for smart investors looking to build growth portfolios, this is a signal that WiMi stock is very lucrative at this current price.
According to a research report, China’s metaverse market size is expected to maintain its growth trend from 2022-2027, reaching $42.53 billion in 2022 and further reaching $126.35 billion in 2027, with a CAGR of 32.98% from 2022-2027.
WiMi is capturing the huge opportunity of the metaverse, a market size worth hundreds of billions of dollars, and the company’s revenue figures continue to trend upward.
WiMi stock will likely not regain all of its previous glory, but this fast-growing company should command a better premium. This is a growth stock, and trying to time its bottom perfectly is nearly impossible. Therefore, with determination to find potential scramble zones, which often act as strong support, it can turn into a bottom in hindsight.
Universal Electronics (UEIC)
Universal Electronics (NASDAQ:UEIC) is a consumer electronics company that makes remotes for TV sets, voice-activated smart home hubs, smart thermostats and home sensors. It also makes related cloud-related software to control these devices online.
Here is the appeal for bargain investors: The company’s earnings are growing quickly, but the stock has a very inexpensive valuation. Moreover, the stock is down over 33% YTD, so it may be reaching a trough, especially if the recession is not as bad as feared.
Moreover, 3 analysts surveyed by TipRanks have an average price target of $46. That represents a potential upside of 70% over today’s price.
Verizon (VZ)
Verizon (NYSE:VZ) is spending heavily to build out its 5G platform. But it is still growing its earnings and free cash flow. Right now, analysts forecast its earnings to rise by 1.8% to $5.51 per share in 2023, up from $5.41 this year.
This puts VZ stock on a forward P/E multiple of just 8.2x this year, and 8.1x in 2023. Moreover, its $2.56 annual dividend is still less than half of the company’s earnings (47%). It also gives the stock an annual dividend yield of 5.76%.
This yield is much higher than its average over the past four years, or 4.42%. In fact, if the price had the same yield now, it would be much higher.
