We are privileged to be living in a time when there are so many different companies that are changing our lives for the better. Every year, more and more businesses come along with an innovative product or service that takes the world by storm. These disruptive companies use technology and non-conventional business models to create something truly unique and that has the potential to turn an entire industry upside down. If you can find these companies early or on sale, they can end up being some of the best investments you can make.
What’s important to note about most disruptive companies is that they are high-growth businesses. That means that many of these stocks have been victims of the recent market selloff and are essentially on sale at this time. While we don’t know how long the selling will persist in growth, it might pay off to start adding shares of innovative companies that have huge long-term potential at this time. Let’s take a look at 3 disruptive stocks to buy on sale now.
1. Tesla
Whether or not you are a fan of this company’s eccentric CEO Elon Musk, you have to admit that he has disrupted the entire automotive industry with this iconic electric vehicle company. Tesla (NASDAQ:TSLA) is a company that designs, develops, manufactures, and sells electric vehicles as well as solar energy generation and storage products. It was the first company to commercially produce a federally compliant electric vehicle, which offers a market-leading range on a single charge. Tesla has essentially made electric and sustainable vehicles attractive for the mainstream thanks to its innovative and high-performance cars, and it’s hard to not be on board with a company that promotes environmentally-friendly values.
While you might be thinking that it’s only a matter of time before competitors start to take market share from Tesla, one could argue that other companies will have a hard time replicating the technology, design, and innovativeness of Tesla vehicles. The stock has been falling hard after the company’s latest earnings report and is down over 36% from its 52-week highs. There’s a chance that the selloff is overdone, and Tesla’s revenue could see huge growth this year if the company can continue to ramp up its China factory. Tesla stock is currently dancing around the 200-day moving average, which might be a great place to consider adding shares but be careful with your position sizing amidst the current market volatility.
2. Etsy
Etsy (NASDAQ:ETSY) is an attractive company to consider owning if you are interested in disruptive e-commerce businesses, and the stock is down over 37% from its 52-week highs at this time. While it is still vulnerable given the current sentiment surrounding growth names, if the stock can reclaim the 200-day moving average at $169, it would provide a very attractive entry point for long-term buyers. Etsy is a rapidly growing online retailer that connects millions of buyers and sellers across the U.S. and in select international markets.
This company is a disruptor thanks to the level of personalization and custom items that are available on its platform. While there are certainly a lot of different products available on different e-commerce websites, Etsy is the only one that is focused solely on creative goods made by artists and entrepreneurs. The company recently reported consolidated Gross Merchandise Sales of $3.1 billion in Q1, up 132.3% year-over-year, and Q1 Net-Income of $143.8 billion, up 1,048.1% year-over-year. While Etsy has an uphill battle trying to beat its growth from last year, this is still a fantastic company to consider owning for the long term, especially at current price levels.
3. Lovesac
While this stock hasn’t pulled back as much as many of the other names in growth, it’s still down from its recent highs and is worth a look given its relative strength and intriguing business model. The Lovesac (NASDAQ:LOVE) is an American furniture retailer that designs, manufactures, and sells furniture including foam beanbag chairs, seats, and accessories. It has also created a unique modular furniture product called a sactional, which is the main revenue source for the company. Sactionals are essentially a sofa with two basic pieces, seats and sides. What’s interesting about them is that customers can start with a small piece of furniture from Lovesac and then invest in additional pieces later on down the road.
There are dozens of different ways that sactionals can be rearranged to fit in someone’s home, and the company benefits from repeat customers thanks to this innovative take on home furnishings. It’s also worth noting that this company’s furniture is built to last a lifetime and is made with yarn that is produced from recycled plastic bottles, which is great for investors who value sustainable products. Lovesac has delivered four consecutive fiscal years of double-digit net sales growth or better and has expanded its digital sales channels during the pandemic, which are additional reasons to consider adding shares.