Growth stocks that soared amid pandemic lockdowns have fallen closer to Earth as concerns have risen about inflation, the Russia-Ukraine war and the global economy.
“Shares of fastest-growing companies had also tended to be the most overvalued,” Morningstar U.S. market strategist Dave Sekera writes in 15 Cheap Growth Stocks Amid the Volatility. “But now that category has become undervalued, and is even more attractive than value stock.”
Morningstar continues to believe that value stocks will “remain attractive and will have good economic tailwinds behind them through the year,” he writes. “Growth stocks, however, have dropped well into the undervalued territory.”
With that in mind, Sekera listed 15 large-, mid- and small-cap growth stocks advisors should once again review for portfolios. This data is as of Feb. 25, when sanctions were heaped on Russia due to the invasion of Ukraine. See the gallery for the Morningstar growth stock picks (note: if price to fair value ratio is less than 1, it’s considered undervalued).