With rising interest rates, explosive geopolitical tensions, the potential for recession, soaring inflation, and many Americans struggling, pessimism rules the roost. However, don’t let it chase you from the markets. Instead, as Warren Buffett says, be “greedy when others are fearful,” and consider these top stocks to buy on the dip.
Or, as he explained at an annual shareholder meeting: “During such scary periods, you should never forget two things: First, widespread fear is your friend as an investor because it serves up bargain purchases. Second, personal fear is your enemy. It will also be unwarranted,” as quoted by MarketWatch.
In short, while others run scared, consider top stocks to buy on the dip.
Nvidia (NVDA)
Weakness has become an opportunity in Nvidia (NASDAQ:NVDA). After running from about $150 to $500 this year, Nvidia pulled back to about $405 thanks to the broad market pullback, but now it’s one of the premium stocks to buy on the dip.
Now oversold on relative strength, MACD and Williams’ %R I’d like to see the tech giant retest $500 again shortly. Longer-term, NVDA is a $600 stock.
Better, earnings went through the roof. Adjusted EPS of $2.70 a share came in above expectations for $2.08. Revenue jumped 101% year over year to $13.5 billion, which was also above expectations for $11.2 billion.
For the current quarter, the company expects to see revenue of about $16 billion, which is also ahead of expectations. NVDA also announced plans to buyback $25 billion in stock.
Occidental Petroleum (OXY)
Many times, when Occidental Petroleum (NYSE:OXY) dips, Warren Buffett’s Berkshire Hathaway will buy so consider this one of the best Buffet stocks to buy on the dip.
In fact, the firm just bought another 3.9 million shares, increasing its stake to 228 million shares, which is worth about $14.5 billion. That now gives Buffett a 25.8% stake in Occidental Petroleum.
“Buffett probably isn’t done building his stake in the company, given that Berkshire Hathaway has received the green light from regulators to own up to 50% of the company,” as noted by Business Insider.
MicroStrategy (MSTR)
In hopes of a Bitcoin ETF, Bitcoin (CCC:BTC-USD) is back up to $34,700. And as long as BTC can continue to rocket higher, MicroStrategy (NASDAQ:MSTR) will follow.
In fact, from a current price of $406.76, I’d like to see MSTR test $500 again near-term. It’s another of the top stocks to buy on the dip. That’s because MSTR now owns about $4.68 billion worth of Bitcoin. So, the higher the value of BTC, the higher the potential value of MSTR.
According to CoinDesk.com, “MicroStrategy now holds approximately 158,245 BTC, which were acquired at an aggregate purchase price of approximately $4.68 billion at an average purchase price of roughly $29,582 per bitcoin.
Take-Two Interactive (TTWO)
Take-Two Interactive (NASDAQ:TTWO) is another of the stocks to buy on the dip, especially as the company nears the release of its hotly anticipated Grand Theft Auto VI.
Even before its release, analysts believe it could see at least $1 billion at launch, and sell around 25 million copies initially.
“In fiscal 2025, we expect to enter this new era by launching several groundbreaking titles that we believe will set new standards in our industry and enable us to achieve over $8 billion in net bookings and over $1 billion in adjusted unrestricted operating cashflow,” said company CEO Strauss Zelnick.
Analysts like TTWO here, too. JP Morgan, for example, just raised its price target on the stock to $165 from $162, with an overweight rating. The firm noted, “The company’s fiscal 2025 guidance for $8B-plus in bookings implies a substantial ramp-up in content before March 2025.”
Amazon (AMZN)
Even Amazon (NASDAQ:AMZN) should be bought on every dip – especially ahead of the 2023 holidays. According to Adobe (NASDAQ:ADBE), online holiday sales are expected to reach $228.1 billion this year, a 4.8% jump year over year.
The report also estimates that about 51% of online spending will be done on mobile devices, as well. In addition, according to Deloitte, e-commerce sales will rise between 10.3% and 12.8% this year. All of which is solid news for companies like Amazon.
Analysts at DA Davidson just raised their price target on AMZN to $157 from $150. Truist also raised its target to $176. Evercore ISI also raised its target to $195 from $190. All after AMZN posted solid earnings. EPS came in at 94 cents, as compared to expectations for 58 cents. Revenue of $143.1 billion was also above expectations for $141.4 billion.
While Amazon Web Services slightly missed expectations for $23.2 billion, with a print of $23.1 billion, CEO Andy Jassy is optimistic, especially with generative artificial intelligence likely to drive billions of dollars of revenue to it.
Agree Realty (ADC)
Agree Realty (NYSE:ADC) is a beaten-down real estate investment trust trading at a 52-week low. Not only does it currently yield 5.46%, but some of its top clients are its high-grade tenants, including AutoZone(NYSE:AZO), Costco (NASDAQ:COST), Home Depot (NYSE:HD), Target (NYSE:TGT), and McDonald’s (NYSE:MCD), for example.
As of June, the company’s portfolio consisted of 2,004 properties located in 49 states and contained approximately 41.7 million square feet of gross leasable area. Insiders are also buying.
Board member John Rakolta bought about 30,000 shares for just under $1.9 million, as I also noted on Oct. 1. CEO Joey Agree bought 10,000 shares. Executive chairman and founder Richard Agree bought about 11,751 shares for just under $740,000.
Plus, consider this. The REIT owns retail properties that secured by triple net leases, where the tenant pays the property expenses such as real estate taxes, building insurance, and maintenance. All in addition to rent and utilities.
In addition, with properties leased to grocery, home improvement, dollar stores, and drug stores, it’s less susceptible to recession.
Technology Select Sector SPDR Fund (XLK)
Or, if you want to diversify at a low cost, consider a beaten-down exchange-traded fund like the Technology Select Sector SPDR Fund (NYSEARCA:XLK), especially with the artificial intelligence and machine learning booms in their infancy.
With an expense ratio of 0.10%, the ETF tracks the price and yield performance of the Technology Select Sector Index.
After dropping from about $172.50 to $161.12, the XLK ETF appears to have caught strong support again. From here, I’d like to see it rally back to $177.50.
I should also note the XLK ETF is technically oversold on RSI, MACD, and Williams’ %R. The last time it was this oversold, it bounced from about $160 to a high of $172.83.
On the date of publication, Ian Cooper did not hold (directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Technology, Artificial Intelligence, Cloud, E-Commerce, Financial, Fintech, Energy, Oil, Real Estate, Consumer Discretionary, Retail, Semiconductor, Video Games
