Students of Warren Buffett's ways likely know one of his most powerful nuggets of investing wisdom: "You can't buy what is popular and do well." In other words, you shouldn't plow into the same stocks as the crowd. You're better-served by coming up with your own picks, even if nobody else seems interested in them at the time.

Except the crowd's become a lot savvier since Buffett first uttered those words. Even the typically new and typically small investors using Robinhood's (HOOD -1.01%) commission-free trading app are making some surprisingly smart picks. Here's a closer look at three of their favorites that are especially compelling prospects right now, in the wake of sizable sell-offs that may be about to reverse course.

Penn National Gaming

Since it's down 60% from last March's high, it would be easy to assume the worst of casino name Penn National Gaming (PENN 0.50%) and its peers. Don't be fooled, though. Casino-laden Nevada enjoyed record-breaking gaming revenue last year, and the state's industry has continued its hot streak through February of this year. While Penn isn't particularly well-represented in Las Vegas, what's happening there is a good proxy for what's happening in other parts of the U.S. (and the world).

That's not the only reason the stock's prolonged pullback makes it a juicy buy this month, however. Penn National Gaming is also operating at the intersection of two other hot trends apt to pay off big soon: online gambling and betting on post-pandemic resumption of professional sports.

Clock face reading "time to buy."

Image source: Getty Images.

Penn also owns a controlling interest in sports-media brand Barstool Sports. Although Barstool isn't a gambling platform, the brand name is being leveraged to promote Penn's nascent sports-gambling efforts. Melding it with last year's acquisitions of Score Media and Gaming, the company says it's now "North America's leading digital, entertainment, sports content, gaming and technology company."

This is no small matter. Market research outfit Technavio estimates the global sports gambling market will grow at an annualized clip of 10% between 2020 and 2025.

fuboTV

Speaking of sports and gambling, put fuboTV (FUBO 7.34%) on your radar -- if not in your portfolio -- following the near-80% slide since November that, like Penn National Gaming, still has it within sight of 52-week lows.

If you're not familiar with it, there are a couple of reasons. It's a relatively small outfit, sporting a market cap of just over $1 billion. That prevents it from being found by a fair number of investors. The other reason is, it's a fairly young company, only coming into existence as the sports-oriented, publicly traded streaming cable television company we know it to be today in 2020.

Don't let its young age or small size fool you, though. This upstart is successfully stealing customers from the cable TV industry's stalwarts, ending last year with 1.13 million paying subscribers, up 106% from its headcount just a year earlier. What's more, fuboTV anticipates its top line exceeding $1 billion this year vs. 2021's revenue of $638 million.

The next growth frontier isn't just the addition of more customers growing tired of paying too much for conventional cable service, though. fuboTV is betting on growth specifically at the intersection of gambling on sports through television-based apps.

By leveraging recent acquisitions of companies like Balto Sports and Vigtory, it's already been able to launch sportsbooks in states where doing so is legal. More are on the way, too. In the meantime, fuboTV has also made agreements with teams like the Cleveland Cavaliers and the New York Jets to offer exclusive access to team-specific content, gambling, and related offerings. More such partnerships are also in the works.

That's a big deal simply because, according to Nielsen, about half the nation's professional sports fans also say they'd be interested in wagering on those games.  That's one of the top reasons Technavio believes the sports-betting market is set to grow at an average of 10% per year through 2025.

PayPal

Finally, add PayPal (PYPL -0.53%) to your list of stocks to consider that Robinhood's investors are highly committed to following.

If you're familiar with PayPal at all, then you know the past few months have been rough on shareholders. The stock's down more than 60% from last July's peak, even with March's rebound effort, as new competition of all sorts has entered the digital payments arena.

It's arguable that shares also came down from their pandemic-prompted high, with consumers diverting at least some of their ramped-up online spending back to more traditional, in-person purchases made with cash and conventional credit cards. Also bear in mind that we're just starting to see the full effect of PayPal's somewhat-severed partnership with online auction platform eBay.

The sellers, however, may have overshot their target.

The fact is, while PayPal's clearly got a lot of work to do if it wants to maintain its lead within the direct online payment and digital wallet space, it's better-positioned to do so than any of its rivals, new or old. Slintel estimates PayPal still controls nearly 31% of the payment management market, with the next-nearest name being Adyen, but only with 22.5% market share. When just talking about payment gateways that facilitate a credit card-based purchase for shopping websites, Maruti Techlabs believes PayPal controls a whopping 91% of the market.

In short, PayPal has become a habit... the go-to payment platform that most of its 400+ million regular users trust so much that they utilize the service without a second thought. This habit is a key reason that revenue is still expected to grow 16% this year and then reaccelerate to a growth pace of nearly 20% next year.

Given all of this, the stock's big pullback is making less and less sense.