The stock market is off to a running start in 2024. For instance, the Nasdaq Composite (NASDAQINDEX: ^IXIC) index has gained 5.9% year to date, led by promising biotechs and giants in the artificial intelligence (AI) market.

But some Nasdaq stocks missed the memo about this Wall Street party. Here are the five deepest price dips on the Nasdaq in 2024, drawing a line in the market-cap sand at $500 million:

Stock

Key Product/Service

Market Cap

Year-to-date Price Change As Of 2/5/2024

Sigma Lithium (SGML -2.07%)

Lithium concentrate for electric vehicle batteries

$1.58 billion

(54%)

Hut 8 (HUT 9.29%)

Bitcoin mining

$612 million

(48%)

Gyre Therapeutics (GYRE 9.99%)

Biotech developing pharmaceutical treatments

$1.02 billion

(48%)

GDS Holdings (GDS 3.13%)

Data-center operations in China

$927 million

(45%)

Cipher Mining (CIFR 3.19%)

Bitcoin mining

$624 million

(41%)

Data collected from Finviz.com on Feb. 5, 2024.

What happened to these tumbling tech stocks? Are they all down for the count, or should investors see at least some of them as undervalued turnaround plays right now?

Let's take a look.

Sigma Lithium: Down 54% in 2024

If electric cars are the future of transportation, the industry will require massive amounts of pure lithium to build the required battery packs. As such, Brazil-based Sigma Lithium, with one of the world's largest proven lithium reserves, should be poised for incredible business growth in the coming years.

However, bulk prices for lithium have plunged 80% lower over the last year, and many market watchers are more worried about oversupply than scarcity at this point. A global surge in lithium production paired with slower electric vehicle sales in the massive Chinese market has tilted the supply-and-demand scales, sending mineral prices to the basement. That's why lithium stocks are plunging as a group, with Sigma Lithium leading the dive.

That's good news for battery makers, car builders, and end-market consumers but not so much for material producers such as Sigma Lithium.

This price drop makes perfect sense, and Sigma Lithium might dive even deeper. I'm not treating Sigma Lithium's dip as a buying opportunity.

Hut 8 and Cipher Mining: Down 48% and 41%, respectively

These crypto-mining specialists are two peas in a pod with nearly identical business models.

Hut 8 is a Canadian company with most of its Bitcoin (BTC -0.51%) mining operations in Alberta, Ontario, and British Columbia but recently expanding into new facilities in Texas and Nebraska. All four of Cipher's mining facilities are found in Texas. Both can be described as North American Bitcoin miners.

They also operate on a similar scale with comparable market caps and annual revenues. They are also deeply unprofitable. Cipher holds a cleaner balance sheet with zero long-term debt and $3.3 million of cash equivalents, while Hut 8 has $142 million of debt and only $12.7 million of cash on hand. Still, Hut 8 has a longer history and a larger collection of self-mined Bitcoin tokens.

It's no surprise to see these risk-laden Bitcoin investments suffer when the leading cryptocurrency inspires bearish headlines. In this case, Bitcoin prices are only down by 2% year to date, but many crypto investors had been hoping for a significant jump if and when the Securities and Exchange Commission (SEC) finally got around to approving the first Bitcoin-based exchange-traded funds (ETFs). A rash of 11 new Bitcoin ETFs made their way to the market in mid-January, but Bitcoin prices stayed firm and even dipped modestly. The mining stocks ran out of rocket fuel and reversed their earlier bull runs.

Bitcoin miners are always a risky investment, though they also hold great promise in cryptocurrency booms. The upcoming halving of Bitcoin's mining rewards is a double-edged sword for these companies, as the intended increase in crypto prices may not materialize for a year or more, but the power bills supporting a smaller amount of Bitcoin production stay the same.

Please tread carefully around these tickers while they're down. Hut 8 looks brittle, and Cipher doesn't have much cash. They may have stunning growth potential if they make it to the next bullish Bitcoin peak, but investors could also lose it all if the halving boost takes too long.

Gyre Therapeutics: Down 48%

The company formerly known as Catalyst Biosciences merged with China-based peer Continent Pharmaceuticals in October. The company also executed a 1-for-15 reverse stock split in order to qualify for listing on the Nasdaq stock exchange. The name change may be meant to distance the reformed business from Catalyst's troubled past.

The company has a promising pipeline of treatments for issues involving inflammation and organ fibrosis. However, the company isn't reporting stellar progress in its research and regulatory approval efforts, and CEO Charles Wu left the company in December for undisclosed health reasons.

Biotech stocks are inherently risky, and many go bust without hitting a big payday. There are some impressive growth phenoms in this category but many more dead-end research projects with unfortunate investor results. It's too early to tell where Gyre Therapeutics may land in the long run, and I'm more worried than excited about this struggling business until further notice.

GDS Holdings: Down 45%

Finally, GDS Holdings is a China-based business that builds and operates data centers in the Middle Kingdom and around Southeast Asia. It has a 23-year history, a large network of high-performance data centers, and a customer list to die for. GDS' two largest clients are local internet giants Alibaba (BABA 2.12%) and Tencent Holdings (OTC: TCEH.Y), together accounting for 45% of the company's net revenue and 52% of its data-center floor space in 2022.

Unfortunately, there's also a serious downside to that highly concentrated client roster. Chinese regulators are imposing heavier restrictions on Tencent's online gambling operations, and the long-running trade tension between Beijing and Washington is limiting Alibaba's cloud computing and AI investments. That's all bad news for GDS Holdings, as its most important clients struggle under heavy-handed government controls.

This may be the clearest glimmer of light on this list. GDS Holdings used to sport a $21.6 billion market cap three years ago. Its revenue growth has stalled but not reversed, and even a long period of draconian regulations shouldn't keep Tencent or Alibaba down forever. I'm cautiously optimistic about GDS Holdings' prospects of making it through these difficult times and getting back on its feet on the other side.

That said, there's no telling how long it may take before international tensions ease (if ever) and GDS Holdings' chief clients are allowed to pursue high-octane growth again. Hence, even this thumbs-up rating comes with a bucketful of caveats, and I think you should keep any GDS Holdings investment rather small even at these rock-bottom prices.