The Nasdaq just tanked. Here are 3 US growth stocks to consider for an ISA now

These Nasdaq stocks have a lot of potential in the long run and Edward Sheldon believes they could be worth considering for an ISA today.

| More on:

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

The flag of the United States of America flying in front of the Capitol building

Image source: Getty Images

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in.

Read More

The content of this article is provided for information purposes only and is not intended to be, nor does it constitute, any form of personal advice. Investments in a currency other than sterling are exposed to currency exchange risk. Currency exchange rates are constantly changing, which may affect the value of the investment in sterling terms. You could lose money in sterling even if the stock price rises in the currency of origin. Stocks listed on overseas exchanges may be subject to additional dealing and exchange rate charges, and may have other tax implications, and may not provide the same, or any, regulatory protection as in the UK.

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More.

The growth-focused Nasdaq Composite index – which is home to big companies like Apple, Microsoft, and Nvidia – just had its worst day since 2022, falling 3.6% on Wednesday (24 July). It’s now down about 7% in just a few weeks. Looking for long-term ISA investments amid this sharp sell-off? Here are three top US-listed growth stocks to consider buying now.

Historically-low valuation

First up we have ‘Magnificent Seven’ company Amazon (NASDAQ:AMZN). It’s a global leader in the online shopping and cloud computing industries (both of which are expected to grow substantially in the years ahead).

Amazon stock was trading at $200 a few weeks ago. Today however, it can be snapped up for $180 – 10% lower.

I’m very bullish on the stock at the current price. Right now, the forward-looking P/E ratio using next year’s earnings per share forecast is only about 30. That’s a historically-low valuation for this company. And given that earnings are forecast to rise 57% this year and 27% next year, I think it’s a steal.

Of course, that valuation is still relatively high. So, if there’s a slowdown in Amazon’s e-commerce or cloud computing businesses in the near term, the stock could be volatile.

Taking a long-term view though, I expect the stock to move higher. Currently, it’s my largest holding.

Taking on Nvidia

Next, we have Advanced Micro Devices (NASDAQ: AMD) or ‘AMD’ for short. It’s a leading chip company (and a major rival to Nvidia).

Back in March, this stock was trading near $210. Now however, it can be picked up for $145 – about 30% cheaper.

I’ve been contemplating buying AMD shares for a while now. And I’m very tempted to pull the trigger at current prices. The reason I’m bullish is that the company has been developing high-powered artificial intelligence (AI) chips designed to compete with Nvidia’s AI products. I expect these chips to propel its revenues higher in the years ahead as the AI revolution gathers steam.

Of course, AMD is going to have its work cut out competing with Nvidia. Today, its rival is the clear leader in the AI chip market.

I reckon there’s room for multiple players in this industry, however. And with the stock trading on a forward-looking P/E ratio of 26 using the 2025 earnings forecast, I like the risk/reward setup.

Benefitting from the travel boom

Finally, check out Airbnb (NASDAQ: ABNB). It operates the world’s largest home rental platform.

Airbnb shares were trading near $170 in March. Currently however, they’re sitting at $144 – about 15% lower.

This stock has a huge amount of potential, in my view. I expect the travel industry to experience a boom over the next decade as cashed up Baby Boomers retire, and I reckon this company will benefit.

Of course, the big risk here is government regulation. Recently, Barcelona announced a ban on short-term rentals from late 2028. We could see similar regulation from other major cities in the future.

The world is a big place though. And I see scope for plenty of further platform growth here.

The forward-looking P/E ratio is about 28 currently, which I believe is very reasonable.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.

Ed Sheldon has positions in Airbnb, Amazon, Apple, Microsoft, and Nvidia. The Motley Fool UK has recommended Advanced Micro Devices, Airbnb, Amazon, Apple, Microsoft, and Nvidia. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

More on Investing Articles

US Stock

The Nvidia share price falls! Here’s what I think happens next for the S&P 500

Jon Smith reviews the overnight results from Nvidia and explains why this could stall the S&P 500 performance through to…

Read more »

Investing Articles

Down 15% today, is this FTSE 100 share too cheap for me to miss?

JD Sports' share price has tanked after the FTSE 100 share released another profit warning. Is this the opportunity I've…

Read more »

Investing Articles

Up 8% today, is this FTSE 100 growth stock a slam-dunk buy for me?

Halma's share price is soaring thanks to another headline-grabbing trading update. Is the FTSE 100 stock now too good for…

Read more »

Investing Articles

With a P/E ratio of just 10.5 is now a brilliant time to buy a cut-price FTSE 250 tracker?

Harvey Jones says a recent dip in the FTSE 250 leaves the index trading at bargain levels. One stock in…

Read more »

Warren Buffett at a Berkshire Hathaway AGM
Investing Articles

To build a passive income flow, I’d follow this Warren Buffett approach

Warren Buffett has set up passive income streams most people can only dream about. Our writer sees some practical lessons…

Read more »

Growth Shares

As the boohoo share price falls, could it become a penny stock in 2025?

Jon Smith outlines some of the recent problems involving the boohoo share price and considers if things could get even…

Read more »

Young Asian woman with head in hands at her desk
Investing Articles

Here are the worst-performing FTSE 100 shares over the last 5 years

These five FTSE 100 shares have been complete duds over the last half decade. But is there potential for a…

Read more »

Investing Articles

Nvidia stock has tripled this year! Can it keep rising?

Nvidia's latest sales update showed strong growth and the stock's been on a tear so far in 2024. So is…

Read more »