No one likes to make a bad decision. Studies have found that the pain of losing is much more intense than the pleasure associated with winning. This aversion to risk could cause you to be afraid of buying any stocks at all during the current market downturn.
However, history shows that investing in times like these often pay off handsomely over the long run. Here are three growth stocks you won't regret buying in this market correction.
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1. Teladoc Health
Teladoc Health (TDOC -2.91%) began falling a lot sooner than the overall stock market did. The stock is down more than 70% from its high in early 2021. Investors have been worried that growth would slow for the virtual care provider as COVID-19 concerns wane.
However, I think the view that Teladoc's fortunes are tied to COVID-19 is one of several major misconceptions about the company. Actually, Teladoc's revenue and its revenue per member increased last year despite the reopening of the U.S. economy.
Teladoc estimates that it has a $75 billion opportunity within its existing membership base, largely through promoting the use of multiple products. Its total addressable market including reaching additional customers is much larger -- more than $260 billion in the U.S. alone.
Virtual care offers cost savings for payers and convenience for patients. Teladoc stands as the leader in the industry with its breadth of services and large customer base. With a market cap of around $8 billion, this stock appears to be dirt cheap in light of its tremendous growth opportunities.
2. MercadoLibre
MercadoLibre (MELI -0.45%) is another one-time high-flying stock that has had its wings clipped. Its shares have fallen more than 50% since September 2021.
Was MercadoLibre's steep decline warranted? Not really. The company continues to rack up impressive numbers. It reported a blockbuster fourth quarter with strong growth across the board.
It's easy for investors to only view MercadoLibre as a Latin American e-commerce powerhouse. The company certainly qualifies as one. And it has massive growth potential in the region, with an e-commerce penetration rate of only 9% in 2021.
However, MercadoLibre is also a fintech powerhouse in Latin America. The company's fintech revenue increased even faster in Q4 than its e-commerce revenue. Don't be surprised if MercadoLibre actually makes more money from fintech than it does from e-commerce within the next few years.
Like Teladoc, MercadoLibre's valuation looks attractive based on its growth prospects. The company's market cap is under $45 billion. I think it could easily be worth several times more by the end of the decade.
3. PayPal Holdings
PayPal Holdings (PYPL -1.14%) ranks as one of the biggest fintech stocks around. However, it's a lot smaller now than it was a few months ago. PayPal's shares have plunged nearly 70% since mid-2021.
The primary concern about PayPal is that its user growth is slowing. PayPal even retracted its goal of reaching 750 million accounts. But don't think for a second that the company is a lost cause. Instead, PayPal looks like a great stock to buy right now.
Importantly, PayPal hasn't changed its overall revenue, earnings, and free cash flow growth targets. The company is simply changing its focus to increasing revenue per user rather than adding a greater number of customers who aren't as profitable.
Also, the long-term tailwinds for PayPal aren't subsiding at all. The shift from cash to digital payments for both online and in-store purchases continues full steam ahead. PayPal remains the most widely accepted digital wallet in the world by far. When the stock market rebounds -- and it will (sooner or later) -- PayPal's shares should return to their winning ways.
