The S&P 500 may be near all-time highs, rising 22% this year. But this growth certainly hasn't been driven by growth tech stocks. Indeed, it's not greed that's driving this group lately -- it's fear.

It has been a brutal week for many growth tech stocks. Streaming-TV specialist Roku (NASDAQ:ROKU), handmade-goods marketplace Etsy (NASDAQ:ETSY), and sports-first streaming platform fuboTV (NYSE:FUBO) were not spared. So far this week, shares of the three companies have fallen 10.6%, 14.4%, and 13.4%, respectively, according to data from S&P Global Market Intelligence.

Here's a closer look at what's behind these three stocks' bearish moves.

A person hitting the buy button on a keyboard.

Image source: Getty Images.

Big losses following big gains

As was the case for many growth tech stocks, all three of these companies' shares were huge winners in 2020. Shares of Roku, fuboTV, and Etsy rose 148%, 214%, and 301%, respectively, last year.

Etsy continues to do well even in 2021, clocking a 40% gain (including the stock's sharp decline this week). But all three stocks were falling sharply this week as many growth stocks were sold off. And unlike Etsy, many growth tech stocks are not in positive territory for the year. Roku and fuboTV, for instance, are down 37% and 35%, respectively, year to date. This means over a third of their market capitalizations have evaporated.

Several concerns in the market negatively impacted growth stocks like Roku, Etsy, and fuboTV this week. First, reports of a new coronavirus variant -- omicron -- over the weekend sparked some fears. Then, U.S. Federal Reserve Chair Jerome Powell said on Tuesday that because of a combination of strength in the U.S. economy and inflation conditions, the Fed will likely soon make a decision in favor of beginning to raise interest rates over time. The Fed meeting minutes also indicated that the Federal Reserve may also be leaning toward beginning the process of tapering the pace of asset purchases.

This news may have spooked some risk-averse investors, causing them to look to deploy more of their income in safer assets.

A buying opportunity?

Of course, companies like Roku, fuboTV, and Etsy are unlikely to suffer just because rates rise slightly or the Federal Reserve's asset purchasing begins tapering. For some perspective on just how early these companies are in their growth stories, consider their revenue growth in recent years.

Etsy's $2.2 billion in trailing-12-month revenue is up from $1.7 billion last year and just $818 million in 2019. Roku's $2.5 billion in trailing-12-month revenue is up from $1.8 billion and $1.1 billion in the same respective periods. FuboTV's revenue has more than doubled from the full year of 2020 to the trailing-12-month period, increasing from $218 million to $512 million.

Better yet, all three companies are still growing at strong, double-digit rates. Roku, fubotTV, and Etsy's third-quarter revenue increased 51%, 18%, and 156%, respectively, year over year.

Thanks to these three stocks' selling off, their valuations are starting to look quite attractive. Roku and fuboTV, in particular, have been beaten down. Their price-to-sales ratios have declined a whopping 52% and 32%, respectively, year to date.

Investors should think twice before they do some knee-jerk selling. Consider this: The Street has been planning for and worrying about rising interest rates and inflation all year. These risk factors are no secret. Indeed, the narratives are well-digested news that the financial media is constantly bombarding investors with.

Let me offer an alternative view: Zoom out. These are three great companies -- and they'll likely continue to do well over the long haul. It's possible that the market has already priced in the negative implications of a higher-rate and inflationary environment.

While these three stocks will likely continue to be volatile, investors should make investment decisions regarding stocks based on their analyses of their long-term earnings potential in relation to their current valuations -- not based on what they think stocks will do in the near term. As famed investor Benjamin Graham has said, "In the short run, the market is a voting machine but in the long run it is a weighing machine." Investors should place their bets based on their long-term expectations of the eventual weight of a companies' earnings. This is what drives the long-term trajectory of most stocks.

You'll have to decide for yourself if these stocks are a good buy today. But they're certainly looking more attractive today than they were last week.

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.