Everybody has their favorite publicly traded companies, me included. My favorites, however, aren't necessarily always the names behind my best stock-buying ideas.
Which tickers I step into largely depends on their price, valuation, and growth prospects at the time. Since these factors regularly change for every organization, so, too, does my list of buy-worthy stocks.
With that in mind, here's a closer look at three of my favorite stocks to buy right now, as you can step in at a discounted price.
Amazon
There's arguably never really a bad time to buy Amazon (AMZN -1.34%). The company is the dominant name in U.S. e-commerce, as well as the biggest name in the global cloud computing market.
It has also been willing and able to evolve its assets and business model -- a wise approach. For instance, in addition to entering (and arguably creating) the public cloud computing industry by launching Amazon Web Services (AWS) in 2006, it's now leveraging its online shopping website as an advertising medium as much as it is an e-commerce platform. The company has done $61 billion in ad business over the past four quarters, versus companywide annual revenue around $700 billion.
So, why are Amazon shares underperforming this year, and down more than 8% since September's high, when most other stocks are up for the same time frame?
It's due to AWS, mostly. Although Amazon's cloud computing division remains a growing cash cow, its progress is suffering a margin-crimpling slowdown driven by artificial intelligence (AI) that rivals like Microsoft and Alphabet's Google don't seem to be experiencing to the same degree.
Just don't give up on Amazon yet. It's maneuvering to rekindle AI-driven growth for AWS.
Although it will take a few quarters to make a measurable difference to its cloud segment's top and bottom lines, Amazon's development of an AI-powered chatbot called Nova is showing promise as a business-building tool.
And the company's business relationship with AI outfit Anthropic is gaining traction while highlighting the power of its home-grown Trainium processor that it hopes will compete with Nvidia's AI chips. This effort will also take some time to prove itself, but there's certainly good reason to expect big things.
In the meantime, remember that AWS' apparent weakness isn't actually rooted in weak orders; it's a reflection of Amazon's struggle to add capacity fast enough to meet soaring demand. That's a pretty nice problem to have. The cloud segment reported a business backlog of $195 billion as of the second quarter, up 25% from year-earlier levels.
The point is: You just have to be patient.
Twilio
In retrospect, Twilio (TWLO -2.44%) was one of the market's earliest major AI businesses. But nobody fully appreciated that its tech was a kind of AI when the company was launched in 2008.
Twilio helps companies ranging from banks to restaurants to retailers automate their communications with customers, whether by text messages, voice phone calls, online chats, or other means. It automates what was previously (inefficiently) handled by humans.
The advent of modern AI takes this technology to a whole new level. Now, Twilio's solutions include fully automated customer service, customer-specific predictions, and even customer-identity authentication.
Image source: Getty Images.
The only problem is that although Twilio's services were difficult to replicate in the company's early days, the advent of user-friendly AI has now made it much easier to do so. That's the chief reason this company's stock hasn't made any real progress since late last year and remains well below its pandemic-prompted peak, when consumers were suddenly doing a great deal more online or by phone.
In the bigger picture, last year's tepid organic revenue growth of only 9% underscores this competitive headwind, but Twilio's sales growth for the second quarter of this year has reaccelerated to a pace of 13%, easily topping the company's full-year guidance for organic top-line growth of only 8%.
So that guidance may be understating what actually awaits now that the company has newer and better AI solutions. The analyst community thinks so anyway. Twilio -- now on track to report per-share earnings of $4.55 this year and $5.21 per share for 2025 -- is bargain-priced at less than 20 times next year's expected profits. The stock is also trading nearly 30% below the analysts' current consensus price target of $130.76.
DraftKings
Lastly, add DraftKings (DKNG 1.38%) to your list of investment prospects following the stock's sizable 11.6% setback on Tuesday. That stumble isn't likely to turn into anything more serious, though.
The reason for the sell-off makes enough superficial sense. The website Kalshi reported record-breaking wagering on Saturday. And it then broke that record the next day.
Most of this swell of wagering stemmed from bets on Saturday's college football games followed by Sunday's pro games, so the market understandably viewed Kalshi's growing reach as a threat to more-conventional sport betting platforms like DraftKings and Flutter's FanDuel. And at least some sports fans will opt for Kalshi's offering rather than DraftKings.
But seeing Kalshi as a serious long-term threat to sports-focused sites ignores DraftKings' (not to mention FanDuel's) long-established history as a sports betting service.
First launched as a fantasy sports website in 2012, DraftKings began adding sports-based wagering when the U.S. Supreme Court lifted the federal ban on it in 2018. As of the second quarter of this year, the company operates a conventional online sportsbook in 28 states, with more on the way.
Meanwhile, most U.S. states now permit DraftKings to operate its "daily" fantasy sports business, which dishes out prize money to fans who successfully create a new winning fantasy sports team every single day, not unlike Kalshi's offering.
The difference is that Kalshi is still mostly a sociocultural wagering platform allowing individuals to make bets on things like election results, economic data, and which of Taylor Swift's newest songs will be streamed most often. Sure, it also offers sports wagering, but the weekend's sport-based betting surge doesn't feel like the new norm for Kalshi.
It feels like an exception to the norm that will ultimately give way to specialized players like DraftKings, which is still expected to report 33.5% revenue growth this year, pushing profits sharply higher as a result. Next year's growth is projected to be just as impressive.
This might help: Prior to Kalshi's recent head-turning news, 28 of the 37 analysts following DraftKings considered the stock a strong buy, with a consensus target of $54.55 that's more than 40% above the stock's present price. It's unlikely that one good weekend from a rival changed this consensus that much.
