Most of the top growth stocks to buy this year are in the artificial intelligence sector, and they have continued to rally and drive up excitement. However, growth stocks in many other industries have yet to catch up and they can deliver spectacular returns when they inevitably rebound.
Most of these depressed growth stocks are still in their growth phase and have massive room for expansion. Snapping up these names right now is the best way to play it before Wall Street becomes more comfortable with these high-growth, high-reward stocks.
Here are three top growth stocks to buy:
Tingo Group (TIO)
Tingo Group’s (NASDAQ:TIO) has tumbled harshly due to Hindenburg Research’s short seller report and is now changing hands at compelling levels. The report put the company’s accounting practices into question and, as Reuters states, “Hindenburg also said Tingo was an ‘exceptionally obvious scam’ and called out founder Dozy Mmobuosi’s claims of having developed ‘the first mobile payment app in Nigeria’.”
However, the company refuted Hindenburg’s claims in its counter-report, and shares have recovered nearly 10%. It is still down more than 72% from its May peak, and TIO stock offers immense value in this range.
Even if Hindenburg’s report is indeed true, there is only so much a company could possibly fake about its financials. Looking at it from a pessimistic perspective, this stock should not be trading at $1.34 a pop. Thus, even with sand thrown in the gears here, I believe Tingo Group has enough momentum to reaccelerate and deliver multibagger returns if you buy at this range. The price-to-earnings ratio here is just 0.81 times with a 3-year sales growth rate of 193%!
CPI Card Group (PMTS)
CPI Card Group (NASDAQ:PMTS) is another growth stock that provides substantial value after tumbling nearly 46% since April. It provides payment card solutions for various sectors, such as financial, corporate, government and healthcare. It offers EMV, and contactless cards, instant issuance, digital cards and prepaid solutions. However, near-term headwinds have been hurting customer acquisition and profitability, hence the slump.
But with the stock trading at its current range, it is an exceptionally strong buy. The headwinds have been priced in here, and management kept its full-year guidance steady in Q1. Revenue still grew 8%, while profits jumped 81%. That’s nothing to scoff at, considering PMTS stock is trading at seven times earnings.
The average analyst upside potential here is 111.72% by next year, with a price target of almost $50.
Sanmina (SANM)
Sanmina (NASDAQ:SANM) specializes in the electrical manufacturing industry. The robotics stock shaved more than a quarter of its value from its November peak to its May trough. However, it has been delivering a strong rebound.
The value here at a forward P/E of 8.86 is hard to ignore. Sales grew at a 21.2% clip in Q1 to $2.32 billion, while its bottom line expanded at 63.8% to $79.6 million. This puts its price-to-sales ratio at an attractive 0.38 times, ranked better than 86% of its peers.
Nonetheless, analysts are mixed here, with a 37.36% upside potential on average. That’s due to concerns about the company having a handful of key cyclical customers and a looming recession on the horizon. However, I’d argue that these recession-related concerns are overexaggerated. Sanmina has robust profits and is already trading at a massive discount with very few near-term headwinds. The company is sitting on just $425 million of total debt, an insignificant risk considering it has $718.2 million in liquidity buffer.
On the date of publication, Omor Ibne Ehsan did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
