5 Stock Market Correction Buys Amid Winter Blues
The bear market is upon us and it’s time to buy the dip. Which stocks are good buys amid the correction? Here are five stock market correction buys for investors.
Jan. 20 2022, Published 2:16 p.m. ET
Financial writer Erin Lowry once penned an open letter to millennials “from” the stock market, which read, “When I take a dip, don't run away screaming.” Well into January, the bear market is upon us and it’s a good time to buy the dip on many stocks. Which stocks are good buys amid the correction?
Here are five stocks to consider for your winter blues buy-in before the latest Wall Street correction is over.
Which stocks are a buy amid the market correction?
The S&P 500 is down 4.7 percent YTD after a year of being 18.67 percent in the green. Here are five stocks you might want to consider for your securities purchases during the market correction.
1. Adobe Inc. (ADBE) is part of the correction.
As of Jan. 20, OG blue chip Adobe (NASDAQ:ADBE) is down 6.89 percent YTD. This contributes to a 13.68 percent drop since July 2020. Adobe is a long-haul investment and has returned 374.63 percent in the last five years alone, a rate that exponentially increases over time based on historical returns. For investors with a generous time horizon, a six-month sale is still a fairly secure bet.
2. NVIDIA Corp. (NVDA)
NVIDIA (NASDAQ:NVDA) is down 16.07 percent YTD—a bear run that’s right in line with the latest market correction. The semiconductor company’s stock has been hot for years (with more than 1,000 percent growth since 2017) and steadfast demand for its chips and metaverse ventures suggests that the trend will likely continue. The stock price is at its early fourth quarter of 2021 levels and might not stay that way for long.
3. Lowe’s Companies Inc. (LOW)
Home improvement store and primary Home Depot competitor Lowe’s (NYSE:LOW) is a smart market correction buy candidate. As we near the end of the third week of January, LOW stock is down 10.25 percent YTD. Even with this drop, LOW is still up 33.02 percent over the last year. The five-year returns are 219.57 percent. Analysts tout it as a Buffett-like stock right now due to its fair price and forward-looking strength.
4. Cloudflare Inc. (NET)
Digital infrastructure and cybersecurity company Cloudflare (NYSE:NET) is down a hefty 23.05 percent YTD. On Jan. 20, the rebound brought the stock up as much as 6.7 percent before dropping off to a milder 2.83 percent gain. Hinting at an upward trajectory, the stock’s one-year and five-year returns are 16.25 percent and 440 percent, respectively.
5. Bill.com Holdings Inc. (BILL)
The bill payments platform aptly named Bill.com (NYSE:BILL) is also in correction territory with a 24.06 percent YTD drop. This is in contrast to its 38.28 percent one-year returns and its aggregate 355 percent five-year returns. BILL stock started falling in the fourth quarter of 2021 as a result of investors exiting high-valuation growth stocks en masse, which makes it more of a speculative egress than a fiscally based one.
Did we know a market correction was coming?
Kai Volatility founder and ex-market maker Cem Karsan publicly predicted the market drop to his Discord group around Christmas time. He was right. As for how long the correction will last, it’s up in the air. However, there are clues. On Jan. 20, the Nasdaq rose after entering correction territory. Rebounds are already in order in some stocks, and trusting your strategy goes a long way.
