2 stocks down 34% and 42% to buy now

Although Micron is not a low-risk investment, the company’s potential to reap long-term benefits from scaling its AI infrastructure appears to be underestimated. For investors looking for attractive risk-reward profiles in the AI ​​space, the stock looks like a good buy at the moment.

Lee Samaha: GXO Logistics (NYSE:GXO) The stock is down about 42% from its all-time high. GXO designs and operates warehouses for customers who want to outsource these operations. The disappointing share price performance could give the impression that something is wrong with the contract logistics provider.

However, the reality is completely different. The decline was due to the spin-off from a freight transport company XPO in the summer of 2021 at the peak of optimism about GXO’s prospects.

At that time, there was huge e-commerce growth, driven by the artificial demand stimulus created by the lockdown measures. As restrictions eased, e-commerce fell and GXO’s organic growth slowed as customers declined after an earlier spike in spending.

The decline is arguably exaggerated, especially as e-commerce growth is back on track. Management expects its organic revenue growth to improve from 2% in 2023 and 2% to 5% in 2024 to a compound annual growth rate of approximately 10% from 2024 to 2027. The optimism is based on the increasing complexity of supply chains, which is encouraging companies can outsource their warehousing, distribution, order fulfillment and e-commerce services to GXO.

Additionally, growth in specialized warehouse technology such as automation, advanced predictive analytics and smart warehouses, as well as GXO’s expertise in these technologies, increases the value of its offering. Therefore, more companies are likely to outsource their logistics to GXO so that they can focus on their core activities. Additionally, existing customers looking to expand internationally may also require GXO’s services.

GXO trades at 22 times estimated 2024 earnings and expects double-digit sales and earnings growth over the next few years. Therefore, GXO appears to be an excellent growth stock at a reasonable price.

Have you ever felt like you missed the boat when it came to buying the most successful stocks? Then you’ll want to hear this.

On rare occasions, our expert team of analysts will provide one “Double Down” shaft Recommendation for companies that they think are about to collapse. If you’re worried you’ve already missed your investment opportunity, now is the best time to buy before it’s too late. And the numbers speak for themselves:

• Nvidia: If you had invested $1,000 when we doubled in 2009, You would have $358,460!*

• Apple: If you had invested $1,000 when we doubled in 2008, You would have $44,946!*

• Netflix: If you had invested $1,000 when we doubled in 2004, You would have $478,249!*

Right now we’re issuing “Double Down” warnings for three incredible companies, and such an opportunity may not happen again in the near future.

See 3 “Double Down” Stocks »

*Stock Advisor returns from December 2, 2024

Keith Noonan holds positions at Micron Technology. Lee Samaha has no position in any of the stocks mentioned. The Motley Fool recommends GXO Logistics. The Motley Fool has a disclosure policy.

“2 Stocks Down 34% and 42% to Buy Right Now” was originally published by The Motley Fool