5 Stocks to Buy Now in a Down Market

Posted on April 24, 2025

The stock market in April 2025 is experiencing significant volatility, with the S&P 500 down 18% from its February high and the Nasdaq Composite firmly in bear market territory after a 23% drop. This downturn, largely driven by uncertainty surrounding President Donald Trump’s aggressive tariff policies, has created a challenging environment for investors. However, market corrections also present opportunities to invest in high-quality companies at discounted valuations. Below, we explore five stocks that stand out as compelling buys in this down market, focusing on companies with strong fundamentals, resilient business models, and attractive valuations. These selections are informed by recent market analyses and expert insights, ensuring a balanced approach to navigating the current economic landscape.

Why Invest in a Down Market?

Before diving into specific stock recommendations, it’s worth understanding why a down market can be an opportune time to invest. Historically, market corrections—defined as a decline of 10% or more—have often been followed by strong recoveries. According to Edward Jones, the S&P 500 has positive returns over 1-, 3-, 5-, 10-, and 20-year periods a significant percentage of the time, even after downturns. The key is to focus on companies with durable competitive advantages, solid balance sheets, and the ability to weather economic uncertainty. In today’s market, concerns about tariffs, inflation, and potential economic slowdowns are weighing heavily on investor sentiment. Yet, companies with strong fundamentals can thrive even in challenging conditions, making them prime candidates for long-term investors.

1. Alphabet (GOOGL)

Why Buy Now? Alphabet, the parent company of Google, has seen its stock decline by 29% from its 2025 peak, driven by broader market concerns about tariffs and their impact on technology companies. Despite this, Alphabet remains a powerhouse with a dominant position in online search and a rapidly growing cloud computing business through Google Cloud. The company’s valuation—at less than 17 times forward earnings—makes it one of the most attractively priced among the “Magnificent Seven” tech giants.

Fundamentals: Alphabet boasts a 29% net margin and nearly $96 billion in cash and equivalents, providing ample flexibility to invest in growth areas like artificial intelligence (AI) and cloud infrastructure. Google Cloud is one of the “big three” cloud providers alongside Amazon Web Services (AWS) and Microsoft Azure, and its growth potential remains significant. In 2024, Alphabet reported 14% year-over-year revenue growth, underscoring its ability to generate consistent cash flows even in volatile markets.

Why It’s Resilient: Alphabet’s core search business is less sensitive to tariff-related disruptions, as digital advertising tends to remain robust across economic cycles. Additionally, its strong balance sheet allows it to navigate short-term economic headwinds while continuing to invest in high-growth areas. For investors seeking a blend of stability and growth, Alphabet is a compelling buy at its current valuation.

2. American Express (AXP)

Why Buy Now? American Express has fallen 27% from its 52-week high, largely due to concerns about a potential recession impacting financial stocks. However, its focus on affluent customers and high credit quality makes it more resilient than traditional banks during economic downturns. Trading at a reasonable valuation, American Express offers a combination of stability and growth potential.

Fundamentals: American Express reported loss rates of around 2% even during the high-inflation period of 2022–2023, significantly lower than many peers. The company generated $1 billion in free cash flow in 2024 and maintains a strong balance sheet with minimal debt. Its business model, which emphasizes premium credit card services and merchant fees, provides a steady revenue stream.

Why It’s Resilient: Unlike traditional banks, American Express caters to high-net-worth individuals with strong credit profiles, reducing the risk of loan defaults during a recession. Its global brand and diversified revenue streams—spanning travel, entertainment, and dining—further enhance its resilience. For investors looking for a financial stock with defensive qualities, American Express is a standout choice.

3. Coupang (CPNG)

Why Buy Now? Coupang, often dubbed the “Amazon of South Korea,” has been caught in the broader market sell-off but remains a strong long-term investment. The company’s stock is down significantly, yet its fundamentals remain robust, with gross profit growing 29% year-over-year in Q4 2024 (excluding one-time gains). At current prices, Coupang offers exposure to a fast-growing e-commerce market at a discounted valuation.

Fundamentals: Coupang generated $30 billion in revenue in 2024 and holds nearly $6 billion in cash with minimal debt. Management projects a potential 10% profit margin as the company scales, which could translate to $3 billion in earnings at current revenue levels. Coupang’s dominance in South Korea’s e-commerce market, coupled with its investments in logistics and same-day delivery, positions it for continued market share gains.

Why It’s Resilient: South Korea’s retail sector is less exposed to U.S.-China trade tensions, making Coupang a relatively insulated play in a tariff-heavy environment. Its focus on operational efficiency and customer experience mirrors Amazon’s early growth strategy, suggesting significant upside for patient investors. Coupang is an excellent pick for those seeking growth outside the U.S. tech sector.

4. Nike (NKE)

Why Buy Now? Nike’s stock has dropped 14% amid concerns about tariff-related cost increases for retailers, but its long-term prospects remain strong. Trading at a 43% discount to Morningstar’s fair value estimate of $112 per share, Nike is one of the most undervalued consumer discretionary stocks in the market. The company’s global brand and leadership in athletic apparel make it a compelling buy during this dip.

Fundamentals: Nike dominates the athletic footwear and apparel market, with a diverse product portfolio and strong relationships with retailers and athletes worldwide. Under new CEO Elliott Hill, the company is investing in innovative marketing and product development to address uneven demand in key markets. Analysts expect Nike to maintain its competitive edge in running, basketball, and lifestyle categories.

Why It’s Resilient: While tariffs may increase input costs, Nike’s premium brand allows it to pass on price increases to consumers without significant demand erosion. Its global presence and diversified supply chain—spanning Vietnam, Indonesia, and other regions—mitigate risks associated with U.S.-China trade tensions. For investors seeking a consumer stock with a wide economic moat, Nike is a top choice.

5. Advanced Micro Devices (AMD)

Why Buy Now? AMD has been hit hard by the market downturn, with shares down 53% from their 52-week high. Despite trailing Nvidia in the data center GPU market, AMD is gaining traction in AI, gaming, and embedded chips. Trading at just 18 times forward earnings, AMD offers a rare combination of growth and value in the semiconductor space.

Fundamentals: AMD reported strong growth in its data center segment, driven by demand for AI-related chips. The company has also been taking market share from Intel in PC and laptop CPUs and is a leader in gaming chips for consoles like the PlayStation and Xbox. Its embedded chip business, used in autonomous vehicles and industrial applications, adds another layer of growth potential.

Why It’s Resilient: The semiconductor industry is cyclical, but AMD’s diversified revenue streams and exposure to secular trends like AI and autonomous vehicles provide a buffer against short-term volatility. While tariffs may impact chip supply chains, AMD’s partnerships with global foundries like TSMC ensure operational flexibility. For investors willing to stomach near-term uncertainty, AMD is a high-reward opportunity.

Navigating Risks in a Down Market

While these five stocks offer compelling opportunities, investors must remain mindful of the risks in today’s market. Tariff policies could lead to higher costs and slower economic growth, with Deutsche Bank analysts warning of a potential 1–1.5% reduction in U.S. GDP growth and increased recession risks. Additionally, the Federal Reserve’s cautious stance on interest rate cuts—projecting only two cuts in 2025—may keep borrowing costs elevated, impacting corporate earnings. To mitigate these risks, focus on companies with strong balance sheets, diversified revenue streams, and the ability to pass on cost increases to consumers.

Conclusion: Seize the Opportunity

The current market downturn, while unsettling, is a reminder that volatility creates opportunities for disciplined investors. Alphabet, American Express, Coupang, Nike, and AMD are five stocks that combine strong fundamentals, attractive valuations, and resilience in the face of economic uncertainty. By investing in these high-quality companies at discounted prices, you can position your portfolio for long-term growth as the market recovers. As always, conduct thorough research and consider consulting a financial advisor to align these investments with your goals and risk tolerance.

Citations:

• U.S. Bank, “This Is What a Market Correction Looks Like,” April 6, 2025.

• Edward Jones, “Weekly Stock Market Update,” April 17, 2025.

• Morningstar, “The 10 Best Companies to Invest in Now,” March 30, 2025.

• Yahoo Finance, “Stock Market Crash: Here Are 5 Stocks Down 27% or More I’d Buy Right Now,” April 8, 2025.

• Investopedia, “Markets News, April 3, 2025: Trump Tariffs Spark Worst Day for Major Stock Indexes Since 2020,” April 2, 2025.

• Nasdaq, “Stock Market Sell-Off: The 3 Best Stocks to Buy Right Now,” April 9, 2025.

Disclaimer: This article is for informational purposes only and not intended as investment advice. Always conduct your own research before making investment decisions.

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