The recent turmoil in the US banking sector has resulted in unease over the health of the economy.
These problems, coupled with rampant high inflation, are threatening to dampen consumer spending.
It didn’t help that the US Federal Reserve had just hiked interest rates by yet another 0.25 percentage points, its ninth increase since March 2022, in its fight against soaring inflation.
Many growth stocks have seen their share prices tumble to a year-low as investors flee for the exits.
While some of these share price declines are justified, others may involve investors throwing the baby out with the bathwater.
Hunting through the bargain bin is a great way to start looking for investment ideas, and we highlight five US stocks that have skidded to their 52-week lows recently.
Match Group (NASDAQ: MTCH)
Match Group is a provider of digital technology and applications to help people to make meaningful connections.
The company owns a portfolio of dating apps including Tinder, Hinge, Match, OkCupid, Meetic, and more.
Shares of the technology company have plunged 61.7% in a year and recently hit their 52-week low of US$34.62.
For the fourth quarter of 2022 (4Q 2022), total revenue dipped by 2% year on year to US$786 million, largely due to foreign exchange headwinds.
On a currency-neutral basis, revenue for the quarter would have risen 5% year on year.
Operating profit plunged by 54% year on year to US$107 million after including a US$102 million impairment of intangible assets.
The number of paying customers dipped by 1% year on year to 16.1 million while revenue per customer also declined by 1% year on year to US$16.
The business, however, continued to generate a healthy free cash flow of US$476.6 million for 2022.
Management expects the first half of this year to remain challenging but affirms its target of 5% to 10% year on year growth for 2023.
Snap (NYSE: SNAP)
Snap is a social media company operating a communications app called Snapchat that allows users to express themselves, communicate with emotions, and tell stories.
Snap’s share price has shrivelled by 69.2% in the past year and recently hit its 52-week low of US$7.33.
2022 was described as a “challenging year” by CEO Evan Spiegel even as the company reported a 12% year on year growth in revenue to US$4.6 billion.
Net loss, however, ballooned to US$1.4 billion for the year, more than double the US$488 million in 2021, as Snap booked restructuring charges of US$189 million.
On a positive note, the social media company generated a positive free cash flow of US$55 million for 2022, its second consecutive year of positive free cash flow generation.
Daily active users on its app also climbed 17% year on year to end off 2022 at 375 million.
3M (NYSE: MMM)
3M is a blue-chip industrial company with four major divisions that manufacture a variety of products ranging from adhesives and tapes to ceramic solutions and wound care products.
The conglomerate saw its shares slide 31.2% in a year to end at US$101.54, just a sliver higher than its 52-week low of US$100.27.
3M saw a tough 2022 with revenue falling by 3.2% year on year to US$34.2 billion.
Operating profit declined by 11.3% year on year to US$6.5 billion while net profit slipped 2.6% year on year to US$5.8 billion.
The company still managed to generate a positive free cash flow of US$3.8 billion, though it was 34% lower than the prior year’s US$5.9 billion.
3M expects macroeconomic challenges to linger in 2023 and is taking continuous action to reduce costs and inventory.
It is also preparing for the spin-off of its Healthcare division and will provide further updates.
Tyson Foods (NYSE: TSN)
Tyson Foods is one of the world’s largest food companies with a broad portfolio of meat-based products.
The company’s headquarters are in Arkansas and it hired around 137,000 staff as of October 2021.
Tyson Foods’ share price has lost a third of its value in the past year and is just slightly above its 52-week low of US$56.07.
The food producer reported a downbeat set of earnings for its fiscal 2023’s first quarter (1Q FY2023) ending 31 December 2022.
Sales edged up 2.5% year on year to US$13.3 billion but operating profit plunged 68% year on year to US$467 million on the higher cost of goods.
Net profit declined by 71.8% year on year to US$316 million.
Tyson Foods eked out a small positive free cash flow of US$173 million for the quarter.
The company has lowered its margin guidance for the remainder of 2023 for its chicken, beef and pork divisions as higher costs continue to bite.
CVS Health (NYSE: CVS)
CVS Health is a health services company that provides a range of services including primary and mental care, health insurance, and prescription and mail-order pharmacy.
Shares of the healthcare provider lost 30% of their value in the past year, closing just slightly above its 52-week low of US$73.91.
CVS Health saw its 2022 revenue rise 10.4% year on year to US$322.5 billion.
However, operating and net profit fell by 41.3% and 47.3% to US$7.7 billion and US$4.2 billion, respectively.
Despite the weaker performance, the healthcare giant upped its quarterly dividend by 10% to US$0.605.
It also repurchased US$3.5 billion of its stock last year.
Just last month, CVS Health announced the acquisition of Oak Street Health, a value-based primary care company, for around US$10.6 billion.
How do you decide if a growth stock is worth your money? There is no shortage of stock ideas today, but is a particular stock suitable for you? Find out more in our latest FREE report, How To Find The Best US Growth Stocks For Your Portfolio. Click HERE to download the report for free now!
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Disclosure: Royston Yang does not own shares in any of the companies mentioned.
