5 Stocks You'll Wish You Bought on This Dip

Hey, welcome back subscribers to my world of stocks. So good to see you guys. Um, we've got another fresh roundup this week of five stocks that fell on earnings. It's going to be a fun one. Well, these are like some of the funnest episodes to do. Um, these are stocks that I feel could be great long-term pickups, but right now they are getting punished by the market after releasing earnings. Now, obviously, there's going to be some risk involved here. The market just started punishing them. they could definitely fall even further for some time. But in my opinion, each one of these is already looking like great values at today's level. So, they might be worth adding to your own watch list, too. Now, if you do want me to continue making u new episodes for this series every week throughout earning season, let me know just by hitting the like button, maybe the hype button down below. That really tells me that you're enjoying the series and that I keep it going. So, if if that's the case, let me know by doing that. But um with that said, we got uh five great stocks to run through here that just fell on earnings. So, let's go ahead and jump into it. All right. Now, kicking things off here with stock number one. We're going to dive into the healthcare real estate sector with healthcare realy trust, ticker symbol HR. Now, this is a re that uh yeah, it's it's a pretty interesting one. um instead of having uh a bunch of shopping malls or you know business offices, they instead own and operate over 560 medical outpatient buildings which is currently the largest in the entire country. Now these are medical facilities that you go to for treatments, checkups, diagnostic labs, or maybe even same day surgeries, but you don't actually stay overnight there like you would in a regular hospital. And HR specifically tries to rent these buildings out to really only the highest quality tenants. In fact, 96% of the medical providers that they partner with are ranked among the top 100 in the country. Meaning that during normal times, the these would be reliable tenants to be collecting rent from. But despite that pretty defensive business model, the stock price has just been getting hammered in recent years. Specifically during the pandemic and post-pandemic years that left, you know, so many medical facilities empty as elective procedures paused and the high interest rate environment that followed just absolutely crushed real estate and more specifically to HR. Uh they also chose to make a giant merger during that terrible environment and that forced them to eventually cut their dividend to pay down debt. Well, all of this really caused their stock price to crater by over 40% in value which continued to dip further this past week, falling close to 8% after reporting their latest earnings. But in my opinion, we are well into oversold territory at this point. First of all, their second quarter earnings were actually very good as their same store operating income actually grew by over 5%. And that's with their properties being almost completely rented out, too, with same store occupancy hitting almost 93%. It's also an extremely high retention rate of 89% which keeps their uh upgrade and commission costs low while they continue collecting rents with little friction. And even when they do sign new leases, their cash leasing spreads actually jumped by about 5% too, proving that they still have some strong pricing power. In fact, things are going so well that management actually raised their fullear FFO and operating income guidance. Beyond these metrics though, um there's re several reasons why I believe that a rebound is due in the stock. Uh for one, if you want a business that is completely insulated from all the AI disruption that is taking place around the world, a physical medical buildings read has got to be near the top of that list, especially as our giant baby boomer population gets older and will require more medical treatment. The demand should only be growing larger over time. I don't see it getting disrupted or going down. And financially that dividend cut that um that caused the stock to fall, well that was exactly the right decision to make in order to help them expand their footprint while still keeping the balance sheet intact. And going forward, their payout ratio is now healthy again at less than 60%. While the yield is still as attractive as ever, even sitting near multi-year highs at close to 5%. It's a very good dividend. Because of the crash in price, the valuation has sunk now too to a price to FFO ratio that is actually 13% lower than the sector median despite this being a market leader. So to me, a rebound is long overdue for this stock. Okay, moving right along to our um stock number two here. We've got a big player in the software and advertising space. That's going to be with AppLovven, ticker symbol A or app, uh which is basically an ad tech company that provides the software and tools to help businesses advertise across mobile apps and games. And recently, they've been using their own AI powered engine to expand that advertising platform out to the giant e-commerce market, too. But if you look at the stock price, you'll notice that it's been getting absolutely crushed, sinking by nearly 20% in a single day after reporting earnings this week. And if you zoom out further, you'll see too that it's actually down a gigantic 60% from its recent highs. Now, part of that larger crash over the past year was really driven by fears that big tech giants like Meta and Google are stepping into their turf along with general market fears about AI disruption, too. Then going into this week with earnings, it didn't help that they slightly missed Wall Street expectations on revenue. But as the CEO explained, this was caused by a small delay in the roll out of their latest upgrades to their AI models, which caused their core gaming segment to underperform in the quarter. However, their guidance for the next quarter also came in a little lighter than analysts wanted to see, too. But to me, a 20% haircut on this report alone feels like a huge overreaction, especially since the business continues to perform incredibly well. Because beyond the slight miss, their total sales actually grew by over 50% year-over-year, bringing in over $ 1.9 billion for the quarter. And more importantly, the company is becoming wildly profitable, too, as their adjusted IBIDA, for example, soared by nearly 60% year-over-year. And that's up to uh 1.6 6 billion. That's a giant profit margin of around 83%. In other words, the company is basically printing cash right now. And although the AI disruption fears linger, they're actually using AI themselves quite well, too, which again, they're now expanding on with the new upgrades. And they have fully opened up the platform to all e-commerce advertisers, which should help them continue growing at high rates longer term. That growth, by the way, when combined with the beaten down stock price, well, it translates to an insanely cheap valuation carrying a PEG ratio that is less than 0.7. That's a whopping 44% lower than the sector median. So, I just think this is looking more and more like a classic buy the dip opportunity for patient investors. Okay, up next though, we're going to head on over to the education technologies market. That's going to be with Duolingo, ticker symbol Dol. This is a company behind that famous Green Owl app that turns learning any new language into an actual game. Their main selling point is basically that, you know, instead of uh having to use like old boring textbooks, this app just goes right on your phone and it tracks your progress with daily streaks, social leaderboards, and just overall it uses like quick little dopamine hits to keep you addicted with the whole language learning process. again, just turning something that, you know, would otherwise be very long and a boring type of a learning experience for for most people into an actually fun type of game to play. And learning new languages, by the way, can be a super valuable asset in the real world. So, there's a lot of stickiness to this business model, too, cuz you get people coming back to learn more, further expand on the that specific language, learn other languages. Um, they don't want to lose their streaks. They have fun socializing and and and with leaderboards and all that kind of stuff. And oftent times they'll even recommend the app to their friends and family too and kind of track their progress as well. As good as all of that sounds though, the stock has actually been getting destroyed, falling another 14% this past week on earnings. That leaves it down now around 70% from their all-time highs. So why the giant crash? Well, like applovening, uh there's been a lot of fear going around too here about AI that advanced AI tools in this case would disrupt their business by offering free human-like translation and tutoring services. And it didn't help that this week too, management gave slightly weaker guidance for the upcoming quarter as they continue to sacrifice short-term profits so that they can focus more on growing their free user base instead. But once again, I just feel that we've got an overreaction here. First off, sales actually grew by 18% in the quarter with profits easily beating estimates, too. And just as important, their user growth is equally impressive with almost 59 million daily active users now, which was up 23% year-over-year. And their paid subscribers grew by 17% too, up to nearly 13 million people. And they've been running clever initiatives lately, too, like their streak revival campaign that managed to bring back over 15 million inactive users back to the app. Beyond the earnings, though, I just really like their new long-term strategy of trying to hit a 100 million daily active users by 2028. This is a move here where by giving up more money today to build up a gigantic loyal fan base in the coming years, they're creating a wider mode that will be much harder for AI competitors to disrupt down the road. And instead of AI killing their business, well, they're actually using it to their advantage, too, just like Apploven. For example, they recently introduced a new video call feature that uses an AI avatar to help you practice speaking a new language in real time. Plus, they're actively using open-source AI models behind the scenes to lower their operating costs, which just pushed their gross profit margins up to almost 73%. Because of that brutal crash from the top, the stock's valuation has finally come way down to earth. Right now, their forward P ratio is sitting right around 20, which is actually more than 90% lower than their own 5-year average. And because of the future growth expected, it drops to less than 14 by 2028, which I do think is a more realistic evaluation of, you know, where this company is headed and where the stock price currently sits. Okay, now moving right along to stock number four. We're actually going to dive back into the real estate sector for a second here because um we're going to look at one of the most famous dividend paying REITs in the entire world and that is Realy Income, ticker symbol O, a giant REIT that operates over 15,000 different properties across more than 90 different industries. And one of the things I really like about them is that they use a triple net lease um structure where their tenants are actually the ones that are forced to pay for property taxes, insurance, and maintenance costs, too. This leaves O with highly predictable, high margin cash flow without all the typical landlord headaches. Plus, because of their size and and stature, O's been able to handpick higher quality tenants, many of which are in in sticky areas like uh like grocery stores, for example. In fact, over a third of their uh rent actually comes from top tier investment grade tenants. But despite this, the stock actually fell over 5% this past week on earnings, leaving it also down around 30% from the previous highs. Again though, like so many REITs out there, this suppression is being highly driven by elevated rates that just continue to weigh on the real estate sector and causing investor panic. But when you actually look at the business and fundamentals, things are still looking like they're in great shape. In fact, they actually beat analyst expectations while their properties remain almost completely full, sitting at about 99% occupancy. And when old leases expire, they're still signing new ones at even higher prices, posting a rent recapture rate of nearly 103%. In fact, results have been so strong that management even raised their fullear guidance for adjusted funds from operations. And they aren't just sitting still sitting around either. They're expanding actually aggressively in Europe, for example, and they even just launched a new joint venture to invest up to $1.4 billion into highly profitable data centers, which could bring in some added growth in the coming years. But because of the big stock crash, their valuation has now sunk to a 13% lower level than the sector median on funds from operations. While their dividend yield has also risen up to a juicy more than 5%. Which is not only among the highest levels in their history, but that dividend has also been paid for, get this guys, so 673 straight months, and it's even been risen every single year since 1994. In other words, it's a great dividend to have. And right now, it's at a discount in my opinion. Okay. And finally for stock number five, I will just give you guys a very quick rundown here of a stock that I actually just made a full um in-depth video on. So if you want to see the complete breakdown, definitely go check that out on on the channel. But that stock was SanDisk, ticker symbol SNDK, the big memory chip and AI storage company that despite reporting an absolute blowout earnings quarter, the stock actually sunk around 15% that day and is currently down around 50% from the previous highs. Now personally I think this stock is just getting misvalued by the market and they don't really know how to treat it after such a gigantic rise of like thousands of percents ever since you know being spun out from Western Digital. So when they gave slightly lower guidance investors just took the opportunity to sell out more and the bigger crash is mostly coming from the cyclicality of the memory chips market where investors fear that competitors will flood the market with over supply. But I still think that their numbers are unreal, posting over 370% growth on the top line, while profit margins broke a record high of 85% and earnings crushed expectations at over 39 bucks per share. Because of it, their forward PE now sits at an insanely low six with a PEG ratio of less than 0.1. I don't even know what to make of that. It's over 97% lower than the sector median. I mean, [snorts] I get that this could all crash and burn when the downturn eventually starts, I guess. Um, but SanDisk is even locking in longerterm contracts with customers now for when that happens. And because of it, I just think that it's worth um considering as as a solid pickup here at these levels on the dip. But hey, there you have it, guys. Five stocks that just fell on earnings. Let me know down in the comments which of these is your favorite. Or if you hate all of them, uh you can let me know know that, too. Why or why not and we can have a fun chat down there. But, uh, hey, either way, I just hope that you enjoyed the video and, uh, thank you for stopping by and I will catch you guys in the next one. All right, take care, my friends. Bye-bye. [music]