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5 Underperforming Stocks Purchasable at Bargain Prices
These equities have a long-term potential for large gains despite being down 42% to 79% so far in 2022.
The discrepancy between a stock’s dropping share price and its expanding operations can lead to some of the most fantastic investment possibilities. Roku (ROKU 0.50%), DigitalOcean (DOCN -0.86%), Olaplex (OLPX 0.37%), Shopify (SHOP -2.31%), and The Trade Desk (TTD -0.65%) are the five businesses showing this gap at the moment. Here’s what makes these undervalued equities so promising despite their difficulties thus far in the year. [1]
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1. Olaplex [OLPX]
With over 100 patents under its belt, each of which has an average of 13 years left until it expires, Olaplex has carved out a special place for itself in the hair care market for “bond-building.” Olaplex offers a routine that enables consumers to “treat, maintain, and preserve” their hair with its 14 products, contributing to the company’s remarkable net promoter score of 71, which measures how likely customers are to refer the goods to a friend. [1]
Olaplex has swiftly risen to the top premium hair care brand on social media because of its increasing popularity on TikTok and Instagram. So what’s the issue with the stock?
Olaplex reported revenue growth of just 9% for the third quarter of 2022, a startling decrease from its 112% increase from 2020 to 2021. This sharply slowing growth has caused a significant decline in the company’s share price. [1]
Despite this, Olaplex’s net income remained constant, giving it a favorable price-to-earnings ratio (P/E) of 14. The business’s net income margin of 38% is astounding. Look for this highly lucrative brand to return as the firm widens its gap from challenging 2021 comparables and keeps expanding internationally. [1]
