There's no nice way to say it. The market is getting absolutely hammered this year.
The tech-heavy Nasdaq Composite index is down about 27% in 2022. It's tough all over, but growth stocks are getting beaten down to prices that were unimaginable a year ago.
Image source: Getty Images.
When markets fall, they tend to fall quickly. The important thing to remember is that they spend a lot more time climbing. Analysts on Wall Street who follow these three growth stocks believe they could do a whole lot of climbing in the not-so-distant future.
Moderna
Shares of Moderna (MRNA -3.33%) have fallen around 70% from the peak they reached last September. Analysts on Wall Street who follow the biotechnology stock think it can make a comeback. The average price target on Moderna right now is 59.7% above the stock's recent price.
Moderna's COVID-19 vaccine generated $10.5 billion in revenue during the first half of 2022, and sales could accelerate in the second half. In August, the FDA authorized the company's omicron-containing bivalent booster shot.
We can expect a sales surge from the new boosters. In July, the U.S. government contracted with Moderna for an initial 66 million doses and secured options for up to an additional 234 million doses.
We'll soon know if Moderna can expand past COVID vaccines. The company has a cytomegalovirus (CMV) vaccine candidate in a phase 3 trial. The company also has a handful of therapeutic candidates in early-stage clinical trials.
PubMatic
PubMatic (PUBM -2.81%) stock has tumbled around 57% from its peak last year. Investment bank analysts on Wall Street are expecting a rebound. The average price target on Pubmatic right now suggests a gain of 60.5% could be up ahead.
Pubmatic operates a digital advertising sell-side platform that helps publishers auction off their available ad inventory to the highest bidder. The company's independence is an inherent advantage over Google, a digital advertising behemoth that operates on both the sell and buy side of the advertising equation.
Independence isn't Pubmatic's only advantage. All the tech its sell-side ad platform runs on was developed in-house. The company's largest competitor, Magnite, has a tech stack built by acquisition. Getting acquired tech to cooperate is a challenge that Pubmatic doesn't have to worry about.
Publishers flocking to Pubmatic's independent sell-side platform pushed second-quarter revenue 27% higher year over year to $63 million. This is a great start, and there's a lot of room to run. The global market for digital advertising is expected to reach $786 billion by 2026. With just a tiny sliver of its addressable market, this stock has a good chance of outperforming for patient investors.
Lovesac
Shares of Lovesac (LOVE -2.34%) soared when the pandemic was still keeping us at home. Unfortunately, the stock has plunged 70% from its peak last year.
Analysts tasked with following this producer of high-end sectional seating think it's poised for a rebound. The average price target on Lovesac suggests a 188% gain could be up ahead.
The company's name is derived from high-end beanbag chairs, but most of its revenue comes from the sale of highly customizable sectionals, called Sactionals. Folks spent a lot less time at home during the first half of 2022 than they did a year earlier. This hasn't dampened demand, though. Sales during the six months ended Aug. 1 soared 50% year over year.
Once customers have invested several thousand dollars into a Sactional, Lovesac has a customer for life. That's because they can always change the shape, size, and upholstery of their Sactionals as their needs, and surroundings inevitably change.
Lovesac's customers might not replace their upholstery and cushioning every year but we can be sure they'll come to Lovesac when they're ready. A dedicated client base that keeps getting bigger could push this stock's share price into the clouds.
