2 Magnificent Stocks Near 52-Week Lows

Source The Motley Fool

A stock trading at a 52-week low is simply when the stock price is at its lowest point of the past 12 months. While this indicator does not guarantee that a stock is set to rebound and do well for shareholders, it can pay to look at a basket of 52-week low stocks and see if there are any high-quality businesses getting thrown out with the bath water. You might find some cheap stocks to buy for your portfolio.

As of this writing on April 23, few stocks are trading at their 52-week lows due to the massive broad market bounce we've seen in the last two weeks as investors try to navigate the tariff-based economic uncertainty. But there are a few strong growth stocks near their 52-week lows that look promising for investors who plan to buy and hold for many years. Here's why Coupang (NYSE: CPNG) and Airbnb (NASDAQ: ABNB) are two magnificent stocks to buy that fit this criterion.

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CPNG Chart

CPNG data by YCharts

Coupang's growing market share

E-commerce has been a massive tailwind for innovative businesses, such as Amazon, that are able to take advantage of this shift in consumer spending. Coupang is an Amazon clone taking over the South Korean market. In fact, one might argue that Coupang has a better e-commerce value proposition than Amazon.

Subscribers to Coupang's Rocket Wow service get free same-day and next-day delivery when ordering by midnight the night before, discounts on food delivery, fresh groceries delivered in hours, and streaming video options. The service is so good, Coupang representatives will even change your tires and install household appliances for free, as long as the products are ordered on the Coupang marketplace, of course.

Most households in South Korea now use Coupang. It generates $30 billion in annual revenue and $1 billion in free cash flow, even as it expands into new countries such as Taiwan and reinvests heavily to improve its offering with add-on services such as the luxury marketplace Farfetch it acquired on the cheap.

Gross profit increased 29% year over year last quarter, excluding changes in foreign currency conversions and inorganic revenue from acquisitions, an impressive growth rate for such a large company. At still a small percentage of overall retail spending in South Korea, I believe there is plenty of room for Coupang to keep growing quickly, especially when you include the expansion into Taiwan.

At today's price of around $22.50, Coupang is only slightly above its 52-week low of $19.76 hit earlier this year. At a market cap of just $41 billion and a long runway to grow its $30 billion in annual revenues, Coupang stock looks like a magnificent steal at today's prices.

Airbnb's expansion plans

Airbnb is a well-known brand around the world, with hundreds of millions of people trying its home-sharing marketplace as an affordable or unique way to travel. Over the years, it has become an increasingly important piece of the global travel pie. Last year, $81.8 billion was spent on the Airbnb marketplace, up 12% year over year.

Growth should continue from this original concept for years, even in Airbnb's more mature markets like North America and Western Europe. The concept is still only a small sliver of the gigantic global travel market. However, to supercharge growth in the years to come, Airbnb is deliberately expanding its marketplace, both geographically and with the products offered to customers.

Management is now custom-tailoring the Airbnb marketplace to unique travel markets such as Japan and Brazil, which is leading to fast growth in these regions. Latin America and Asia Pacific both saw 20%+ growth in nights and experiences booked in Q4 of last year, which is faster than overall Airbnb growth. On top of this global expansion, Airbnb has been prepping for years to add on new services to its marketplace. These will be new products for both guests and hosts on the Airbnb platform, and could possibly include travel packages, cleaning services, and other add-ons to improve the value proposition for both sides of the marketplace.

These growth prospects make Airbnb a great stock to buy at its current price of $118, not far off its 52-week low of $105.69. You can buy Airbnb stock at a reasonable price and hold it in your portfolio for the long term.

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Brett Schafer has positions in Amazon and Coupang. The Motley Fool has positions in and recommends Airbnb and Amazon. The Motley Fool recommends Coupang. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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