It's been one of the toughest starts of the year in a long time. The S&P 500 Index has chalked up a 16.4% decline from January's high, nearly tipping the bellwether index into bear market territory. The Nasdaq Composite Index, which houses a wide swath of growth and technology stocks, has fared even worse. The index fell 13.3% in April alone, and is now down 25% year-to-date, putting it firmly in bear market territory.

It's important, however, to separate the business from the stock price. Many companies were not that long ago flitting with all-time highs as the pandemic caused their valuations to surge into the stratosphere. With the pandemic easing and the Federal Reserve announcing a series of interest rate hikes to help tamp down rising inflation, numerous growth stocks have seen their valuations tumble, dragging their shares prices sharply lower.

Businessman in home office using tablet

Image source: Getty images.

With these price plunges, there are now stock bargains to be found as many businesses continue to post healthy growth, albeit at a slower level than anticipated. Here are three companies doing well whose stocks are down sharply in the past year but still hold significant promise for the future.

1. Fiverr International

Fiverr International (FVRR 4.49%) operates a platform that matches freelancers to the potential employers that require their services. As economies have recovered and more people have gone back to their offices, investors have become concerned about Fiverr's ability to grow its freelancer pool. The company's shares have declined by 77% in the last year, and sentiment remains weak as concerns grow over the hybrid work shift that's part of the new normal.

Fiverr continued to soldier on with a respectable set of numbers for its fiscal 2022's first quarter. Revenue grew by 27% year over year to $86.7 million, while gross margin remained high at 80.4%. Active buyers continued to climb by 11% year over year to 4.2 million, a testament to the company's ability to continue attracting clients, while spending per buyer rose 17% year over year to $251. However, guidance for 2022 was revised downwards to 16% to 23% from 25% to 27% previously as the macroeconomic environment has become more uncertain.

Investors should keep the faith with Fiverr as it continues to expand its catalog to support a wide range of requirements. The company opened more than 25 new categories to expand its total addressable market, which also helps to diversify its revenue streams. Fiverr's new AI Auditions tool helps artists "audition" for roles without having to read from a script, and greatly increases the probability of matching a voice actor to a buyer looking for their services. These continuous improvements should make Fiverr's platform more attractive over time, and help it to attract and retain more freelancers and clients.

2. Shopify

Shopify (SHOP 5.60%), a provider of internet infrastructure for a host of entrepreneurs and small-business owners, has seen its share price slide by close to 67% in the past year. Investors are getting worried about the company's growth as economies reopen and e-commerce adoption slows. Even Shopify admitted that its gross merchandise value (GMV) was "supercharged" over the past two years due to lockdowns and government stimulus checks.

However, the company has continued to grow its top line, with revenue rising 22% year over year to $1.2 billion for the first quarter of 2022. GMV was up 16% to $43.2 billion, while monthly recurring revenue grew 17% year over year to $105.2 million. Despite these encouraging numbers, investors have grown increasingly worried about Shopify's fulfillment network (SFN), which is facing difficulties in scaling and encountering stiff competition from e-commerce giant Amazon (AMZN 1.17%).

Shopify plans to solve these difficulties with the acquisition of Deliverr, an e-commerce fulfillment technology provider, for $2.1 billion. By combining SFN and Deliverr, Shopify hopes to create an end-to-end logistics platform to provide fast and easy fulfillment. In line with this purchase, the company has introduced Shop Promise, which will help its customers enjoy next-day or two-day deliveries from their favorite vendors. Concurrently, Shopify also launched its Audiences features, which help merchants locate new customers that intend to purchase their products. Early usage has helped merchants see an increase in conversion rates and achieve higher returns on advertisement spending. These moves should help the company gain better traction in capturing and retaining customers and create stickiness to its platform.

3. Zoom Video

Zoom Video Communications (ZM 3.47%) is the poster child of the pandemic as demand for remote communications soared sharply due to lockdowns and movement restrictions. Some of this luster has faded in the last 12 months as Zoom's share price slid 70%, and investors may be wondering if the videoconferencing company can sustain the rapid growth it chalked up for the last two years.

Its fiscal 2022 earnings (for the year ended Jan. 31) still displayed significant growth, with revenue growing 55% to $4.1 billion. Net income more than doubled from $671.5 million to $1.38 billion. The guidance for fiscal 2023's revenue was somewhat muted, with the company projecting a 10.7% growth over 2022. While it may seem like growth is slowing, it's important to remember that these numbers may represent a normalization of Zoom's growth rate from the unsustainable surges it experienced throughout the pandemic.

A more sustainable growth trajectory is a good thing for the business, and Zoom has demonstrated its ability to continue to innovate with new services and features for its growing base of enterprise customers, which numbered 191,000 at the end of fiscal 2022 (up 35%). The company introduced Zoom Whiteboard, a solution that allows for collaboration and creation for employees situated in disparate locations. Zoom has also been active in acquisitions, and just announced the purchase of Solvvy, a conversational artificial intelligence and automation platform for customer support. Harnessing the latter's capabilities, Zoom hopes to deliver more personalized customer experiences that help to address queries expediently while solving issues more quickly.