It's been a brutal year for investors.

The S&P 500 -- an index of the 500 largest companies in the U.S. that's widely viewed as a measure of the overall performance of the stock market -- plunged 20% from the end of 2021 to the end of June. It's the worst downturn since the S&P 500 fell 21% in the first six months of 1970. 

Yet amid the carnage lies opportunity -- if you know where to look.

Interestingly, the S&P 500 recovered its losses and surged 26.5% in the second half of 1970. In fact, the market has rebounded from every major downswing to eventually rise to new all-time highs. It's highly likely it will do so again.

Here are three outstanding businesses that could lead the stock market's recovery. Buying their stocks today can position you to profit handsomely from an eventual rally.

This tech giant is set to grow even stronger

Financial fortitude is paramount during difficult economic times. Bountiful cash reserves and strong free cash flow production allow companies to survive recessions and other calamities. The strongest businesses often emerge stronger from these challenges, as they're able to invest straight through market downturns to expand their operations, even as many of their lesser rivals are forced to cut back on their growth-related spending. 

Microsoft (MSFT -1.84%) excels in this regard. The software titan generated more than $63 billion in free cash flow over the past year. It also has over $100 billion in cash reserves on its fortress-like balance sheet. 

That's allowed Microsoft to invest aggressively in high-growth areas such as cloud computing and artificial intelligence (AI). The tech colossus also made a $68.7 billion bid in January to acquire video game publisher Activision Blizzard to expand its leading gaming operations. These investments should help to fuel Microsoft's expansion -- and allow the tech leader to reward its investors with solid, long-term gains.

Moreover, you currently have the opportunity to buy Microsoft's shares at an over 25% discount from their highs in late 2021.  

You can profit from the travel industry's recovery

Coronavirus-related disruptions have contributed to the market's poor performance so far in 2022. COVID-19 has had a particularly devastating impact on the travel and tourism industry, which has only just begun to recover from the forced closures and other strict safety measures initiated during the early stages of the pandemic.

Walt Disney (DIS -0.45%) was not spared from these difficulties. The entertainment giant was forced to close its theme parks and dock its cruise ships during the initial stages of the pandemic. Movie theater closures also weighed heavily on its film production and distribution business.

Yet vaccines, treatments, and rising levels of natural immunity to COVID-19 are giving people the confidence to venture outdoors once again. Crowds are returning to parks and resorts. And the movie theater industry is enjoying a solid rise in customer traffic this summer. Disney stands to benefit from these trends perhaps more than any other business, as do its shareowners.

Better still, you can buy Disney's stock today at a nearly 50% discount from its 52-week highs. 

This retailer saves people money and offers a treasure hunt

Inflation is perhaps the biggest driver of the stock market's recent swoon. Rising prices for food, energy, and other vital goods are taking a heavy toll on consumers' budgets. However, it's in this type of challenging economic environment that Costco Wholesale's (COST -0.55%) business model shines brightest.

The warehouse club chain offers a curated, ever-changing selection of high-quality goods at bargain prices. This treasure hunt-type shopping experience is particularly appealing to consumers who are trying to stretch their budgets -- as many people are doing today.

Costco's revenue metrics bear this out. The retailer's net sales jumped 16.9% to $18.2 billion in May. Investors can expect Costco's warehouse club model to continue to resonate with shoppers in the coming years. This should drive further gains in Costco's sales and profits, as well as wealth-building returns to shareholders along the way. 

Best of all, Costco's stock itself is quite a bargain. You can scoop up this best-in-class retailer's shares today at a greater than 20% discount from their recent highs.