7 Growth Stocks to Buy on the Dip: April 2024 (2024)

Dips present long-term buying opportunities for investors who can wait for conditions to improve. Some corporations exhibit stock price declines due to temporary industry-specific headwinds or macroeconomic headlines.

Growth stocks have the potential to outperform the market, but those great expectations also come with heightened volatility. TheS&P 500andNasdaq 100are both still up year-to-date, but both of these indices have been sliding to start the second quarter. Things can get worse before they get better, but these growth stocks offer enticing opportunities for investors who can look to 2030 and beyond.

Microsoft (MSFT)

Microsoft(NASDAQ:MSFT) continues to expand its lead in the artificial intelligence race. The company also has dominant positions in the cloud computing, gaming, advertising, and business software industries.

Analysts can’t get enough of the stock and believe that it has a19% upsidefrom the current price. Microsoft is currently rated as a “Strong Buy.” Financials came in good inQ2 FY24as the company reported 18% year-over-year revenue growth and 33% year-over-year net income growth.

Microsoft has plenty of opportunities to generate higher growth rates and reward investors with steady cash flow. The stock has been shedding some of its gains since April and is approaching correction territory. The development has brought Microsoft below the $3 trillion valuation. Shares now trade at a 36 P/E ratio and offer a 0.75% dividend yield. Long-term returns have been good as the stock has more than tripled over the past five years.

Synopsys (SNPS)

Synopsys(NASDAQ:SNPS) is a promising semiconductor stock that is in the middle of a correction. Shares are down by roughly 15% from their all-time highs and currently trade at a 57 P/E ratio.

The chipmaker has exhibited impressive growth rates to warrant the valuation. The firm reported 21% year-over-year revenue growth and 65% year-over-year net income growth in thefirst quarter of fiscal 2024.

Synopsys looks ready to gain market share through itspending acquisitionofAnsys(NASDAQ:ANSS). Once Synopsys clears regulatory hurdles, the two companies will join forces in a move that can reward long-term investors.

Synopsys is rated as a “Strong Buy” among 10 analysts with anaverage price targetof $630 per share. This price target suggests a 23% upside from the current price. The stock has received recent price targets above the average, with one target as high as $675. This price target implies a 32% gain from current levels.

Amazon (AMZN)

Amazon(NASDAQ:AMZN) is the world’s leading online marketplace that generated $574.8 billion innet sales in full-year 2023. That’s a 12% year-over-year increase. Amazon accelerated sales growth in Q4 2023 by posting 14% year-over-year growth during that timeframe. Success with domestic and international markets contributed to $170.0 billion in total Q4 2023 revenue.

The company continues to grow in multiple verticals. E-commerce is the company’s biggest growth engine, but Amazon Web Services, advertising, and streaming are also key contributors with immense potential.

Amazon is approaching correction territory like many large-cap tech stocks. The company’s improving profit margins and declining P/E ratio can make it a pick to consider for long-term investors. The tech giant has thelargest market share in cloud computingand looks poised to strengthen its profit margins in the coming quarters. Analysts are bullish on the stock and believe that it can deliver a21% upsidefrom current levels. The stock is currently rated as a “Strong Buy.”

Crowdstrike (CRWD)

Crowdstrike(NASDAQ:CRWD) has an immense40% upsidebased on the average price targets from 40 analysts. The stock is rated as a “Strong Buy” with the highest price target of $435 per share suggesting a 54% upside.

The company’s Falcon Platform has become an essential resource for many business owners who want to keep their companies and stakeholders safe from cyberattacks. Hackers can do a lot of damage if they infiltrate systems and access sensitive data and documents. Most companies don’t want to take that risk and prefer to invest in cybersecurity solutions.

The dynamic has worked well for Crowdstrike which recently delivered record profitability and sales. Total revenue reached $845.3 million inQ4 FY24. It’s a 33% year-over-year increase. Annual recurring revenue jumped by 34% year-over-year to reach $3.44 billion. Rising profit margins can make the75 forward P/E ratiomore manageable.

The stock is in the middle of a correction and has dropped by more than 10% since the start of April. This development can increase the stock’s appeal for investors who are window shopping.

Duolingo (DUOL)

Duolingo(NASDAQ:DUOL) delivers impressive growth rates across the board. Revenue increased by 45% year-over-year inQ4 2023while daily and monthly active users increased by 65% and 46% year-over-year respectively. The language learning app now has 88.4 million monthly active users and closed the quarter with $12.1 million in net income. That’s a big change from the $13.9 million net loss posted in the same period last year.

The educational tech company has a lot going for it in the long run, but investors have to contend with a122 forward P/E ratio. The stock’s current correction can help, especially if it gets deeper. Equities have had a rough start to the second quarter, but investors who have 10-year time horizons may be able to capitalize on this opportunity.

Duolingo’s 51% year-over-year increase in total bookings suggests that the strong financial results can continue. Analysts also feel optimistic and believe the stock has a24% upsidefrom current levels. Duolingo is currently rated as a “Moderate Buy.”

Meta Platforms (META)

Meta Platforms(NASDAQ:META) has aprojected 14% upsideand a “Strong Buy” rating amid a correction. The company continues to attract new users and reported an8% year-over-year increase in daily active users.

User growth contributed to the company’s record earnings. Revenue grew by 25% year-over-year to reach $40.1 billion in Q4 2023. Net income more than tripled during the same period to reach $14.0 billion. The significant profit margin expansion prompted the company to establish its first quarterly dividend. The dividend is low at just $0.50 per share each quarter, but investors should expect the company to hike the dividend by 10% or more for several years.

Meta Platforms is the leading social media giant and generates most of its revenue from advertisem*nts. Adventures into artificial intelligence and virtual reality can create additional revenue streams for the company.

Guidance also came in pretty good. The company anticipates Q1 2024 revenue to range from $34.5 billion to $37.0 billion. Meta Platforms generated $28.6 billion inQ1 2023. The company’s guidance for Q1 2024 implies a year-over-year growth rate ranging from 20.6% to 29.4%.

American Express (AXP)

American Express(NYSE:AXP) is one of the few fairly valued growth stocks remaining. The valuation isn’t just based on what the company can become, but it’s already reasonable given the firm’s current financials.

The stock trades at a 20 P/E ratio and offers a 1.22% dividend yield. The P/E ratio is lower than most credit and debit card peers. American Express also has a higher yield than most of its competitors and has maintained a double-digit dividend growth rate for several years.

American Express got investors excited with impressive financial results inQ1 2024. Revenue increased by 11% year-over-year. That’s within the company’s range of 9% to 11% year-over-year revenue growth beyond 2026.

The fintech firm shined with net income surging by 34% year-over-year. Diluted EPS jumped by 39% year-over-year while American Express suggested a growth rate in the mid-teens beyond 2026. American Express is also experiencing heightened demand from younger generations. 60% of the company’s new cardholders are Gen Z or Millennial customers.

On this date of publication, Marc Guberti held long positions in MSFT, SNPS, and AMZN. The opinions expressed in this article are those of the writer, subject to theInvestorPlace.comPublishing Guidelines.

Marc Guberti is a finance freelance writer at InvestorPlace.com who hosts the Breakthrough Success Podcast. He has contributed to several publications, including the U.S. News & World Report, Benzinga, and Joy Wallet.