The S&P 500 has been having a tough week, but it's still trading relatively close to record highs. The same can't be said for many growth stocks that have experienced steep declines in recent months. Admittedly, some of these stocks supported high price-to-earnings (P/E) ratios that priced them for perfection, and the market punished them when they failed to live up to the hype.

With the recent price corrections, many of these growth stocks now support more reasonable valuations. These discounted prices and promising growth prospects mean investors might want to consider taking another look at three top stocks that just went on sale: GrowGeneration (GRWG 1.67%), Pinterest (PINS 0.61%), and Roku (ROKU 0.89%).

Two people walk by a 50% off sign as they pass a store on the sidewalk.

Image source: Getty Images.

1. GrowGeneration

Admittedly, GrowGeneration may not be a household name yet. However, its 62 stores between California and Maine have achieved rapid growth by consolidating the hydroponics industry and using that to advance the cultivation of cannabis. Hydroponics, which involves growing crops in water instead of soil, allows growers to cultivate cannabis in a variety of climates.

GrowGeneration's stock had a great run up in 2020 but has taken a massive hit, falling by approximately 80% from its 52-week high set in February. Along with a broader migration to value stocks that started in the spring, a cannabis supply glut on the West Coast has slowed its store growth efforts. The company also announced last week the sudden retirement of EVP and COO Tony Sullivan. It remains unclear how that will affect the company or the stock.

Still, in its first three quarters of 2021, GrowGeneration reported revenue of $332 million, a 153% increase from the same period in 2020. While the $17 million in profit amounted to a 342% year-over-year increase, the company nearly quadrupled operating expenses over the same timeframe to build and expand stores.

Admittedly, an increase in outstanding shares and slowing same-store sales growth may have upset investors. However, money raised from selling shares has funded expansion. The "slower" same-store sales increase still came in at 16%, ahead of the 6% increase reported by Home Depot and the 13% rise in same-store sales at Tractor Supply. Since stores need to be open for more than one year to count same-store sales, GrowGeneration could only use 25 of the 62 stores in this calculation.

Additionally, the P/E ratio has fallen to the 45 range, a probable bargain considering the rapid revenue growth. As its footprint expands and revenue continues to rise, GrowGeneration holds the potential to turn its stock around over time.

2. Pinterest

Pinterest is the social media site of the imagination, allowing users to "pin" the ideas that inspire them. It earns revenue from this because advertisers can use promoted pins to turn that inspiration into sales. Such an advantage gives Pinterest a competitive advantage over sites that rely on more generalized demographics and psychographics.

Although the company prospered at the height of the pandemic, usage has suffered as users return to more offline activities. Monthly active users (MAUs) have fallen from 478 million in the first quarter to 444 million six months later.

Nonetheless, average revenue per user (ARPU) compensates well for this stagnation. Overall, Pinterest reported an ARPU of $1.41 in the third quarter, up 37% from the $1.03 ARPU earned in the year-ago quarter. Given this increase, Pinterest generated revenue of more than $1.7 billion in the first three quarters of the year, up 75% from the first nine months of 2020.

Due to slow growth in operating expenses, Pinterest reported a net income of $142 million in the first nine months of 2021. The company lost $336 million during the same period in 2020.

Unfortunately, this progress did not stop Pinterest's stock from losing more than 60% of its value since February. Despite the drop, the P/E ratio stands at about 70, well above the P/E of 24 for Meta Platforms.

Nonetheless, as the world continues to try to move on from the pandemic, MAU growth could come back. When combined with the current ARPU growth, investors should consider looking at these conditions to buy Pinterest at a heavily discounted price.

3. Roku

Roku stock has fallen for most of the second half of 2021. Investors also have become increasingly concerned about emerging competitors such as Alphabet, LG, and Samsung. Additionally, Roku has failed to grow beyond single-digit market shares outside of North America, according to Conviva, leading to concerns about the addressable market.

However, Roku has made strides in the U.K. and will make its players available in parts of Europe and South America. Grand View Research also forecasts a compound annual growth rate of 21% through 2028, giving Roku an expanding market to pursue.

For the first nine months of this year, revenue surged 68% vs. the first nine months of 2020 to about $1.9 billion. The 49% year-over-year growth in ARPU to $40.10 helped boost revenue. Thanks to slowing operating expense growth, net income came in at $219 million during the first three quarters of 2021. Roku posted a loss during the same period in 2020.

Moreover, investors might want to consider Roku now that the stock has lost more than 55% of its value since July. Roku's stock valuation is also getting attractive since the price-to-sales ratio has fallen to 12, a level it has not often seen since the middle of 2019. This price, along with the exploding demand for streaming services, could help Roku stock recover as the company continues to drive rising ARPU.