After the Sell-Off, are Growth Stocks now Values?

Image: Bigstock

With growth stocks still falling to start 2022, lots of people have been asking Tracey on Twitter if they are now “values”. After all, a stock that is down over 50% must be cheap now, right?

Two Different Ways to Identify Value Stocks

Remember, there are two ways to find “value” stocks.

1. Using classic value fundamentals such as low PEG, P/S, and P/E ratios.

2. Looking at value compared to peers or the industry.

Meta Platforms (FB - Free Report), for example, has a forward P/E of 21 which wouldn’t make it “cheap” using traditional value fundamentals.

But compared to the other FANGMAN stocks, Meta Platforms is a value.

Meta Platforms has the lowest P/E among the FANGMAN stocks. It also is trading near the low end of its historic P/E range.

Meta Platforms might be one growth stock that does have value.

Growth Stocks: Values or Traps?

1.       Shopify (SHOP - Free Report)

Shopify was one of the top growth stocks of the last 5 years, with shares rising 1585% during that time.

Who didn’t wish they had gotten in years ago?

But Shopify shares have dropped 45% in the last 6 months, including 35% in 2022 alone.

Is this a buying opportunity in Shopify?

2.       PayPal Holdings, Inc. (PYPL - Free Report)

PayPal has been an investor favorite since its 2015 spin-off from eBay. Over the last 5 years, PayPal shares have gained 306%.

But in the last 6 months, PayPal shares have slid 49%, including losing 16.9% year-to-date.

Are PayPal shares cheap enough for value investors to be taking a look?

3.       Snowflake (SNOW - Free Report)

Snowflake went public during the pandemic, in 2020.

Two years later, Snowflake still doesn’t have a forward P/E because its earnings are still expected to be negative.

Over the last 6 months, Snowflake shares have fallen just 4.5%, but year-to-date they are down 25.3%.

Is Snowflake a value or a trap?

4.       CrowdStrike (CRWD - Free Report)

CrowdStrike has been a popular cybersecurity stock during the pandemic.

Shares of CrowdStrike are up 150% since its 2019 IPO but have fallen 41% in the last 6 months. Year-to-date, they’re down 22.5%.

Has CrowdStrike gotten cheap enough for value investors to take a look?