3 Beaten-Down Stocks That Could Be Great Long-Term Bargains


One important principle all investors should know is that when the stocks of excellent companies drop for no apparent reason, it’s an opportunity to buy, not sell. In this Fool Live video clip, recorded on July 14, Fool.com contributors Matt Frankel, CFP, and Brian Withers discuss three stocks in particular that could be worth a closer look while they’re down. 

Brian Withers: Fool Wise gave us, I think, 15 different stocks that are down versus I guess the S&P, and they’re saying, “Which are best buys now?” I’m going to pick two off this list. Lemonade (NYSE:LMND) is always a favorite for me. You mentioned it’s down 55%. Certainly, I think Lemonade had some hype as it went off, but I know I feel like the market is discounting its move into auto insurance and discounting its actual ability to compete against the long-standing insurance companies that have been around forever. And I think Lemonade has got a lot going for it. The other one I’ve been pitching my book this week is Teladoc (NYSE:TDOC). I think telehealth is here to stay, similar to hybrid office space is once you’ve gotten away with taking your kid to the doctor without having to wait in the waiting room and put them in the minivan and drive across town and wait and deal with other sniffly kids in the doctor’s office. I think that’s an awesome experience that’s just going to continue. Matt, do you see any on that list you like?

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Matt Frankel: Well, you stole Lemonade. So there is that.

Withers: Yeah.

Frankel: Other than that, I’d say my best by now would probably be Airbnb (NASDAQ:ABNB) out of that list. I just think that’s an underappreciated business opportunity. The more I dig into it, the more I love it. We’ve talked about it on the show before where at first, I couldn’t get my head around spending an $80 billion lodging stock. But this could be a $800 billion company if they really attack their market opportunity and continue to execute. Not saying it’s going to get there overnight. This is a long-tailed growth opportunity, it’s a trend. People want flexibility when they travel. The legacy providers, meaning hotel companies like the one I’m sitting in right now, aren’t really providing it.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

View more information: https://www.fool.com/investing/2021/07/26/3-beaten-down-stocks-that-could-be-great-long-term/

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