The Motley Fool recently highlighted two historically cheap growth stocks that investors should consider adding to their portfolios. Both of these stocks are currently trading at single-digit forward-earnings multiples, presenting an enticing opportunity for long-term investors.
The first stock recommended is Baidu (BIDU), a China-based internet search giant. Despite concerns around regulatory issues and the Chinese economy, Baidu remains a dominant player in the search engine market, commanding over 50% of domestic search traffic. The company is also expanding into cloud services and autonomous ride-hailing through Apollo Go, showcasing its strong potential for growth and diversification. With a sizable cash position and a low forward-year earnings multiple, Baidu presents an attractive investment opportunity at its current valuation.
The second stock highlighted is Fiverr International (FVRR), an online-services marketplace connecting freelancers with clients. Despite initial worries about AI disrupting the freelancer space, Fiverr has embraced technology to enhance its platform and drive sales. The company has benefited from changes in the labor force post-pandemic, increased spend per buyer, a high take rate on transactions, and strategic acquisitions to enter new verticals. With a low forward-year earnings multiple and strong growth prospects, Fiverr is positioned for success in the evolving online marketplace.
Overall, both Baidu and Fiverr offer compelling investment opportunities for long-term investors seeking growth stocks at discounted valuations. With their unique business models, strong fundamentals, and growth potential, these stocks cannot be ignored any longer in the current market environment. Investors looking to capitalize on undervalued growth opportunities should consider adding these stocks to their portfolios for potential long-term gains.
