Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our website policy prior to making financial decisions.
Market corrections and sell-offs are not the times to panic. After the market slumps and quick rallies in March and August, we may be nearing another one. Knowing that all market dips eventually recover, here are some dip-buying options you can exploit. After all, the opportunity to buy expensive blue-chip stocks at much lower prices doesn’t come too often.
Stocks to Buy After a Market Crash
Market crashes are inevitable — especially during our current volatility spurred by COVID-19. But some argue that market crashes are a good time to start investing as they aren’t all bad news; they allow for certain opportunities.
Tesla is no stranger to volatility. Soon after Elon Musk announced, a few days ago, the efforts to develop an affordable EV lineup within the range of $25,000, Tesla’s stocks dropped. Moreover, this lineup is supposed to integrate the new generation of batteries; much cheaper and offering greater range per charge.
Such news would’ve been welcomed by investors and would’ve almost certainly caused a spike in Tesla’s stocks. However, there are a couple of problems to account for. Elon Musk had already promised an affordable Tesla car in the past. It was never realized as Model 3 exceeded the $35,000 price range.
Not only that, but Musk promised the relatively cheap version under $25,000 back in 2018, with the goal of it being released next year. Needless to say, the projected launch of the again-promised $25,000 EV is postponed to 2023, at least. This is much later than investors had anticipated.
With all of this in mind, Tesla operates under higher standards of expectations than most companies face. Its battery technology is steadily improving, and its massive infrastructure in the form of Gigafactories across the world is becoming a reality.
Accordingly, despite the current 24% loss of value, Tesla is poised to win the long game, as it is already ahead of other EV manufacturers. Lastly, you should expect gas-powered vehicles to be institutionally sanctioned in the near future.
Apple is our resident long-term pick, and its recent slump of 22% is insufficient to dismiss Apple’s strong fundamentals, brand loyalty, and market domination as a giant standing next to the Android ecosystem. Most recently, Apple botched the launch of its 5G smartphones due to a series of chip-supply issues.
However, 5G is not something that is at the forefront of customers’ priorities. It will take a while for 5G networks to become commonplace even in the most developed nations. Until that time, Apple has an impressive record of growth.
Apple’s year-over-year (YOY) revenue is up by 11% and over 18% in Q2 2019. Its ecosystem of services – News, Arcade, CCs, Apple TV – has accumulated a further 130 million subscribers compared to the same period last year. Overall, Apple’s recent 4-to-1 stock split at the end of August provides an additional opportunity to purchase this record-breaking blue-chip stock.
Leading the way in the electronic signatures sector, this company did not make any missteps to incur a significant stock dip from its peak value. On the contrary, DocuSign is up by 45% YOY during Q2 2020, with a 61% increased billing rate.
The post-corona world is a godsend to a company like DocuSign, where most organizations are transitioning to remote administrative work. The inevitable transition from pen and paper to electronic signature was DocuSign’s foundational business model from the get-go. Even with the pandemic in the rear-view mirror, the new cost-effective organizational habits are sure to stay.
This means that DocuSign is poised to ride the tide of the new momentum of electronic signature adoption as demonstrated by DocuSign’s stock increase by almost 200% this year. It puts DocuSign at the fourth place of this year’s biggest stock winners, with very few troubles looming ahead outside of temporarily going down with the rest of the stock market’s correction.
Have any stocks caught your attention recently? What do you think of the three picks above? Let us know in the comments section below.
Disclosure:Tim Fries has no positions in any of the stocks mentioned, and has no plans to initiate any positions within the 72 hours following the publishing of this article. This article expresses the opinions of Tim Fries. Tokenist Media LLC has no position in any of the stocks mentioned, and does not plan to initiate any positions within 72 hours of the publishing of this article. Please consult our website policy for more information.
Tim Fries is the cofounder of The Tokenist. He has a B. Sc. in Mechanical Engineering from the University of Michigan, and an MBA from the University of Chicago Booth School of Business. Tim served as a Senior Associate on the investment team at RW Baird's US Private Equity division, and is also the co-founder of Protective Technologies Capital, an investment firms specializing in sensing, protection and control solutions.