We’ve seen a lot of volatility so far this year, and this week has been no different with several down days of selling.
Among other things, what sent volatility rising this week was news that Trump is planning to limit Chinese investments in “industrially significant technology,” as trade tensions ramp up globally.
But these selloffs can present smart buying opportunities for some of the market’s hottest stocks.
The following stocks have been hit hard by this week’s volatility. But for each, there’s huge upside just ahead.
PayPal (NASDAQ: PYPL)
We recently wrote about PayPal, which is up 12% year-to-date. But the stock is down -4% this week which may be good for investors.
The company is a leader in global digital payments and has made some smart investments of late, including its acquisition of Sweden-based iZettle which will give PayPal a stronger global presence, especially in Europe.
Wedbush analyst Moshe Katri just upped his price target for the stock to $100 – nearly 22% higher than today’s prices.
He says of PayPal, “We believe ongoing/recent monetization efforts on both consumer and merchant-facing platforms, Visa (NYSE: V) / Mastercard (NYSE: MA) / banking partnerships, as well as post-eBay (NASDAQ: EBAY) separation, potential opportunities could potentially accelerate top-line growth, while expanding margins.”
Nvidia (NASDAQ: NVDA)
Nvidia has had a rough week. The stock is down over -6% and the company has lost $13 billion in market cap over the last several days for seemingly no reason.
But, while the stock has been hit hard by the market sell-off, there’s still huge upside potential for the hot chip maker.
RBC Capital analyst Mitch Steves pushed his target price for the stock up to $310, which is just under 30% than the closing price on Thursday.
“We are updating our upside case model for Nvidia and believe there is potential for $13 in EPS assuming the company continues to grow at 25%+ and sees operating margin expansion,” Steves said in his recent report to investors.
Nvidia will be boosted by the booming gaming industry and data center trends. In fact, Steves notes that data center segment sales should grow at 100% in the near-term and high double digits over the long term.
“If the Data Center segment continues to grow at rapid rates (highest margin business) and the operating expense line remains stable, we see potential for 45%+ operating margins,” Steves wrote.
Netflix (NASDAQ: NFLX)
Netflix has delivered insane gains for investors, and has risen 106% year-to-date. But the streaming giant has come under some pressure recently.
Jeffrey Wlodarczak, an analyst at Pivotal Research, believes there’s 30% more upside ahead for the stock, boosting his price target to $500 last week.
According to Wlodarczak, Netflix “appears to operate in a virtuous cycle, as the larger their subscriber base grows, the more they can spend on original content, which increases the potential target market for their service and dramatically increases barriers to entry.”
Netflix has ramped up their marketing strategy and has had several impressive content launches, which should be reflected in its next earnings report on July 16.