Nasdaq Pullback: 3 Stocks You'll Wish You Bought on the Dip
Why it matters: Investors could miss out on significant gains if they don't capitalize on the current discounts in stocks like Alphabet and MercadoLibre.
- Nasdaq Composite Index has rebounded from a 13% plunge but is still negative year-to-date.
- Alphabet (GOOG, GOOGL) has seen an even steeper share price decline than the Nasdaq, which the author believes is an overreaction given its strong AI prospects, including Google Cloud's $17.7 billion Q4 2025 revenue and $240 billion backlog.
- Google's Gemini AI model has been integrated into Search, leading to higher search traffic and AI Mode queries that are three times longer, creating more monetization opportunities.
- MercadoLibre (MELI) has plunged over 30% from its peak and is down double-digits year-to-date, attributed to shrinking operating profit margins, the Middle East conflict, and a high valuation.
- MercadoLibre's margin compression is viewed by the author as a result of investments in growth opportunities that are expected to pay off handsomely.
Despite the Nasdaq Composite Index's rebound from a 13% plunge, it remains in negative territory for the year, presenting a buying opportunity for high-quality stocks at a discount. The article highlights Alphabet (GOOG, GOOGL) and MercadoLibre (MELI) as two such stocks, arguing their recent sell-offs are overdone given their strong growth prospects and underlying business fundamentals.
