3 Hard-Hit Stocks to Buy Now Before a Market Rally

It might seem like all investors hear these days is doom and gloom. But the stock market will rebound sooner or later. You can count on it. 

No one knows for sure how long the current bear market will last. However, forward-thinking investors should be preparing now for the eventual comeback. Here are three hard-hit stocks that look like especially great picks to buy before a market rally.

1. Amazon.com

Shares of internet-giant Amazon.com (AMZN -1.64%) have fallen nearly 40% year to date. A much-hyped 20-for-1 stock split earlier this month didn't provide much of a catalyst.

Much of Amazon's dismal performance stems from the overall stock market malaise. However, the company's e-commerce growth is slowing. Amazon also has excess capacity in its fulfillment and transportation network that's likely to cause its cost structure to be higher for several more quarters.

But a slowdown in e-commerce sales growth is to be expected after the unprecedented surge resulting from the COVID-19 pandemic. More importantly, the long-term opportunity remains tremendous. Despite the impressive growth of e-commerce, online shopping still represents only 14.3% of total retail sales in the U.S. The penetration rate is even lower in many other countries.

Amazon also has plenty of other growth drivers. Its Amazon Web Services cloud hosting business stands at the top of the list. The company has started to offer its "Just Walk Out" cashierless checkout technology to other retailers. It's moved into healthcare and self-driving car technology. 

Thanks to the recent sell-off, Amazon stock is cheaper than it's been in a long time. When the stock market rebounds, investors who bought Amazon at a discount will likely be glad they did.

2. Nvidia

Nvidia (NVDA -3.33%) has been beaten down even more than Amazon. So far in 2022, the chip stock has plunged nearly 50%.

Most tech stocks have declined in the wake of the broader stock market tumble. While Nvidia has continued to deliver strong financial results, it faces macroeconomic headwinds, including the Russian invasion of Ukraine and COVID-19 lockdowns in China.

Nvidia's gaming business could be sluggish throughout much of this year. But the transition to a new architecture later in 2022 seems likely to provide a spark. Over the longer term, gaming seems likely to remain a strong growth driver for the company. 

Growth in the data center market, though, will probably be an even more important tailwind. In particular, the rising adoption of artificial intelligence (AI) should continue to fuel higher demand for Nvidia's graphics processing units.

I'm also bullish about Nvidia's Omniverse platform. It enables the development of real-time 3D simulations. Many big companies are already using Omniverse (including Amazon). The platform could become much more important to Nvidia's fortunes over the next decade. 

3. Intuitive Surgical

Intuitive Surgical (ISRG -0.55%) is in the same boat as Nvidia. Shares of the robotic surgical-systems company have plummeted nearly 50% this year.

Increasing COVID-19 cases in some parts of the world have hampered Intuitive's growth. The company has also experienced supply chain and logistics issues that caused problems. In addition, hospitals are facing financial pressures, largely due to COVID-19 that, along with rising interest rates, could curtail their capital spending.

These should only be temporary challenges for Intuitive Surgical, though. The company should benefit from the unstoppable demographic trend of aging populations around the world. Older people tend to require more surgeries. 

Intuitive also continues to push the envelope on the types of surgical procedures where robotic technology can be helpful. The vast majority of surgeries today don't use robotic assistance. As Intuitive Surgical demonstrates how its systems can be used in new procedures, its addressable market will most likely expand.