7 Promising Stocks to Buy on the Dip

  • If you’re the type that throws caution to the wind, these deflated but intriguing growth stocks to buy may liven up your portfolio in the long run.

Ordinarily, you don’t want to attempt to catch a falling knife simply for its own sake. Sure, in some narrowly defined contexts, you can get away with it. However, when publicly traded companies — particularly those labeled as growth stocks — shed massive double-digit losses, there’s usually a reason for it. Nevertheless, the present volatility provides possible upside returns for the long run.

And that really sums up the theme for today. Recently, we’ve seen the equities sector tumble due to myriad fears, ranging from recession to inflation to war. Ultimately, cooler heads may prevail (as it always has throughout human history) but when that will occur is anyone’s guess. Therefore, you can position yourself into these heavily discounted growth stocks but with the understanding that you’ve got to be patient.

If you can accept the risks — and have the time to see through the ambiguous waters ahead — you might want to check out these growth stocks to buy on the dip.

Bloom Energy (BE)

In my opinion, Bloom Energy (NYSE:BE) may be the perfect example of growth stocks to buy that battle-hardened contrarian investors are eyeballing. On the surface, BE stock seems the antithesis of a reasonable investment. Recently, the fuel-cell specialist released its earnings report for the first quarter and it wasn’t pleasant.

The highlight (or perhaps the lowlight) of the disclosure was Bloom Energy’s earnings-per-share, which came in at a loss of 32 cents. This figure compared poorly to the EPS loss of 11 cents that covering analysts were targeting. Further, in the year-ago quarter, Bloom presented comparatively superior optics, posting an EPS loss of 7 cents.

Still, with an aspirational and growth-oriented company like Bloom, you must focus on the bigger picture. In particular, the company’s AlwaysON microgrid solution could empower energy resilience, a circumstance that has been socially and economically problematic since the beginning of the new normal.

Rivian Automotive (RIVN)

Let me be upfront that I haven’t been particularly enthused about electric vehicle manufacturer Rivian Automotive (NASDAQ:RIVN). It’s not that I dislike the company per say. However, with so many EV companies now competing in the heavily contested arena, it’s unlikely (in my view) that they’ll all succeed.

I mean, let’s face reality here. The average household income for those purchasing EVs is about $140,000. That’s basically twice the U.S. average. Yet there are so many EV competitors in the space, all fighting for a narrow piece of the consumer pie. It doesn’t seem realistic.

Ironically enough, it’s Rivian’s management team that appears to be more in line with reality than some of its rabid followers. Recently, it disclosed risks regarding supply chain pressures and the rising cost of raw materials.

Lyft (LYFT)

From a cursory perspective, it might be hard to understand why ride-sharing platform Lyft (NASDAQ:LYFT) suffered significant losses following its Q1 earnings disclosure. Just by the numbers, the performance was quite solid. For instance, Lyft posted revenue of $875.6 million in Q1, beating out the consensus target calling for $845.5 million.

So, what gives? Although companies love to celebrate past achievements, Wall Street is forward looking. Therefore, management’s softened guidance for Q2 convinced stakeholders to hit the exits. Essentially, the downgraded outlook reflected the worries of our time, namely inflation and rising energy costs. Subsequently, such headwinds could negatively affect consumer sentiment, which wouldn’t be conducive for LYFT and other similarly exposed growth stocks.

Bill.com (BILL)

A San Jose, California-based technology firm that provides automated, cloud-based software for financial operations, Bill.com (NYSE:BILL) is quickly becoming a go-to platform for the burgeoning gig economy. From the perspective of gig workers, it’s a convenient 21st century timeclock: punch in your hours worked (or whatever business metric that’s used) and off you go.

Although it’s a relevant innovation, BILL stock is suffering a rather antithetical experience. On a year-to-date basis, BILL is down 57%, with much of the losses stemming from a mixed earnings report. Although the underlying company enjoyed record customer additions, revenue in the most recently completed quarter grew by only 6.6% year-over-year. That was a much lower growth compared to the double-digit numbers seen in prior quarters.

Sea (SE)

A tech conglomerate firm headquartered in Singapore, Sea (NYSE:SE) remains one of the most frustrating ideas among growth stocks to buy. On one hand, the company is extraordinarily compelling because of its relevance to the emerging markets of Southeast Asia. But on the other hand, SE has to demonstrate this potential with positive returns.

Well, SE is returning something but nothing good across recent time frames. For instance, on a YTD basis, SE has dropped a staggering 71%. And this isn’t just a victimization of arbitrary context. Indeed, you have to go back to late May 2020 to when SE stock was trading hands this low.

WiMi Hologram Cloud (WIMI)

WiMi Hologram Cloud (NASDAQ: WIMI) focuses on computer vision holographic cloud services and is a leader in the holographic VR/AR industry. In the context of 5G digital information era, WIMI masters 5G, cloud computing and edge computing to solve the limitation of computing power and improve information transmission rate quality, and its large-scale application will provide users with support to connect to the virtual world anytime, anywhere. At the same time based on deep learning AI artificial intelligence algorithms to improve the efficiency of data collection and processing, will be widely applied in providing convenience for the entertainment of digital life data collection and processing content production. This also allows it to form a strong holographic AR technology R&D ecosystem and build a holographic AR value industry chain with great potential for expansion.

In the metaverse era, WIMI established metaverse division, with the company’s current mastery of VR/AR and other XR technologies, it can complete the research of such projects. So far WIMI has laid out nearly 5,000 items of content production of augmented reality and virtual reality, completed digital content and scene construction, and successfully released a number of VR/AR headset products. In addition, there is a large amount of graphics rendering and AI learning needs, and thus a greater demand for such chips. In order to meet this need, WIMI has been developing its semiconductor business since 2020, and providing comprehensive solutions for computer chip products and central processing algorithms and related services as well as software and semiconductor business to corporate customers. This can largely solve the massive computing problems faced by the metaverse environment.

TeraWulf (WULF)

On the surface, TeraWulf (NASDAQ:WULF) sounds like an extraordinarily compelling concept. With the cryptocurrency market representing one of the biggest paradigm shifts in the entire investing ecosystem, it only makes sense that growth stocks catered to crypto-mining operations will enjoy at least the possibility of significant upside. Further, TeraWulf specializes in sustainable mining, distinguishing it from other miners. However, a closer inspection into TeraWulf reveals a highly speculative venture.

For one thing, the company appears to be a pre-revenue firm. According to its most recent Form 10-K disclosure, “TeraWulf expects to generate revenues” through its crypto-mining endeavors, which suggests that it’s not posting sales currently. As well, the underlying digital asset market has been tanking due to global recession fears, sending WULF into the abyss.