Key Points

• AMD and GitLab are two beaten-down tech stocks seeing strong AI-related growth.

• e.l.f. Beauty's acquisition of Rhode positions it for a rebound.

• While well off their highs, Dutch Bros and Cava are two of the best growth stories in the restaurant space.

While the market has returned to new highs, not every growth stock has rebounded at the same pace. Five stocks still down 20% or more from all-time highs that look attractive are Advanced Micro Devices (NASDAQ: AMD), GitLab (NASDAQ: GTLB), e.l.f. Beauty (NYSE: ELF), Dutch Bros (NYSE: BROS), and Cava Group (NYSE: CAVA).

Let's look at what each of these five discounted growth stocks brings to the table.

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1. Advanced Micro Devices (down 35% from high)

While AMD remains a distant second to market leader Nvidia in graphics processing units (GPUs), it's starting to carve out a meaningful niche in artificial intelligence (AI) inference. That's important because the inference market is expected to become larger than AI training over time, and AMD's cost-effective chips are starting to gain traction.

On its latest earnings call, management said one of the largest AI-model companies is now using its GPUs for a large share of its daily inference workload. Major cloud providers are also turning to AMD chips for AI tasks like search and recommendation engines.

The company already has a leadership position in data central processing units, and its overall data center revenue has been growing strongly. Last quarter, its data center segment soared 57%, helping total revenue climb 36%. AMD doesn't need to unseat Nvidia in the GPU space, it just needs to gain a modest share to drive outsized growth from its smaller base. Given the pullback in the stock, the setup here looks attractive.

2. GitLab (down 65% from high)

GitLab has become one of the most important players in secure software development. Its DevSecOps platform is helping developers build, test, and deploy applications more efficiently in a secure environment, and its recent GitLab 18 launch only strengthens that position. The release includes over 30 new enhancements, including the GitLab Duo Agent Platform, which deploys AI agents across the entire software development life cycle, not just for code but also for documentation, testing, and compliance.

The company is seeing solid growth both from existing customers and new ones. Last quarter, its revenue climbed 27% year over year, while its dollar-based net retention rate was a robust 122%. Much of this growth is coming from existing customers expanding seats and upgrading to higher-tier plans.

While some investors fear that AI will lead to fewer coders over time, thus far, AI has led to an increase in both software development and the number of coders. GitLab stock has fallen too much on this fear, and it looks well-positioned moving forward.

3. e.l.f. Beauty (down 40% from high)

After a red-hot run, e.l.f. shares cooled off after the company's revenue growth slowed significantly to just 4% in its fiscal Q4. However, its recent $1 billion acquisition of Hailey Bieber's Rhode brand has the potential to reaccelerate growth in a big way.

Rhode has already hit $212 million in annual sales with just a handful of products on its website and minimal marketing. With e.l.f.'s strong relationships at Ulta Beauty and Target and Rhode's recent Sephora rollout, e.l.f. has the opportunity to put the brand in front of a lot more consumers. Bieber staying on as chief creative officer ensures brand continuity, and Rhode brings with it premium price points and a strong skincare lineup, which is an ideal complement to e.l.f.'s core mass-market cosmetics strength.

e.l.f. has already proven it can take a lot of market share in mass-market cosmetics, and Rhode adds a big potential growth driver. The company also continues to have opportunities with skincare, international expansion, and potentially moving into other adjacent categories like fragrance over time.

4. Dutch Bros (down 21% from high)

Dutch Bros is still in the early innings of what looks like a multi-year growth story. The drive-thru coffee chain now has over 1,000 locations but sees room for 7,000 over the long term. It's targeting 2,029 shops by 2029, which would still leave it with a long growth runway next decade as well.

Expansion is not the only story with Dutch Bros, though. It's also had strong same-store sales growth, and has an opportunity to continue to ramp it up. Last quarter, its same-store sales rose 4.7%, while company-owned comps climbed 6.9%. However, mobile ordering has just recently been rolled out, and the company has just begun piloting food items. Dutch Bros has admitted that a lack of breakfast offerings has likely cost it sales, and rival Starbucks has shown just how important food items can be, with food representing 19% of its sales last quarter.

Between an opportunity to grow same-store sales and expand its store base, Dutch Bros has a lot of long-term growth ahead of it.

5. Cava Group (down 43% from high)

Another strong growth story in the restaurant space is Cava. The Mediterranean restaurant operator has posted four straight quarters of double-digit same-store sales growth, including 10.8% last quarter. More impressively, traffic was up 7.5%, showing that customers are coming in more frequently despite price increases.

Higher-priced add-ons like pita chips and fresh juice are boosting ticket sizes, and the company is experimenting with new menu items and a tiered loyalty program to keep customers coming back. However, like Dutch Bros, Cava is very much an expansion story.

The company added 15 new restaurants last quarter and plans to open 64 to 68 new locations this year. With just 382 total restaurants as of the end of last quarter and a target of 1,000 by 2032, there's a long runway ahead. Its expansion strategy, dubbed the "coastal smile," has worked well, and a recent push into the Midwest with markets like Detroit and Chicago should accelerate growth even further.

Should you invest $1,000 in Advanced Micro Devices right now?

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Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $699,558!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $976,677!*

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Geoffrey Seiler has positions in GitLab, LVMH Moët Hennessy - Louis Vuitton, and e.l.f. Beauty. The Motley Fool has positions in and recommends Advanced Micro Devices, GitLab, Nvidia, Starbucks, Target, Ulta Beauty, and e.l.f. Beauty. The Motley Fool recommends Cava Group and Dutch Bros. The Motley Fool has a disclosure policy.

Sunny days and summertime festivities are on the horizon for June. But there's no guarantee the clouds overhanging the broader market will dissipate.

Instead of trying to guess what the stock market will do in the short term, a better approach is to invest in companies with strong underlying investment theses that have the staying power to endure economic cycles.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

Here's why these Fool.com contributors see Apple (NASDAQ: AAPL), Shopify (NASDAQ: SHOP), Cava Group (NYSE: CAVA), ExxonMobil (NYSE: XOM), and Energy Transfer (NYSE: ET) as five top stocks to buy in June.

Apple's pricing power will be put to the test

Daniel Foelber (Apple): There are 30 components in the Dow Jones Industrial Average (DJINDICES: ^DJI), and the worst-performing year to date is health insurance giant UnitedHealth (NYSE: UNH) -- which crashed due to cost pressures, regulatory scrutiny, suspended guidance, and another major leadership change. However, it's the second-worst performing Dow stock that is piquing my interest in June -- Apple.

Apple is down 22% year to date at the time of this writing -- making it the worst-performing "Magnificent Seven" stock. I think the sell-off is an excellent opportunity for long-term investors.

The simplest reason to buy Apple is if you think it can pass along a decent amount of tariff-related cost pressures. The latest update at the time of this writing is a 25% tariff on smartphones made outside the U.S. And since Apple assembles the vast majority of iPhones in China, the tariff could directly impact its bottom line.

Given higher labor costs and manufacturing challenges, moving production to the U.S. isn't a viable option. So, the million-dollar questions are how long tariffs will last and if Apple can pass along some of its higher costs to consumers.

A major catalyst that could drive iPhone demand even if prices go up is the upgrade cycle. Apple releases new iPhones every September. Most consumers aren't upgrading every year, but rather, waiting until they need to upgrade or the features appeal to them.

The upcoming iPhone 17 could have far more artificial intelligence (AI) features than the iPhone 16 -- which could attract buyers even with a higher price tag. Investors will learn more about Apple's technological advancements at its Worldwide Developers Conference from June 9 to 13.

Also, in Apple's favor, its pricing has stayed consistent for years. The base price of a new iPhone hasn't changed since 2017 as the company has preferred to keep prices low to get consumers involved in its ecosystem to support growth in its services segment. Apple's product growth has been weak in recent years, but the services segment has flourished, led by Apple TV+, Apple Music, Apple Pay, iCloud, and more.

Given tariff woes, it's easy to be sour on Apple stock right now. But the glass-half-full outlook on the company is that if tariffs do persist, at least they are coming during a time when Apple is expected to make by far its most innovative iPhone ever.

All told, long-term investors looking for an industry-leading company to buy in June should consider scooping up shares of Apple.

A growing e-commerce platform giant

Demitri Kalogeropoulos (Shopify): Shopify stock returns are roughly flat so far in 2025, but there are brighter days ahead for owners of this e-commerce services giant. The company just wrapped up a stellar Q1 period, as sales growth landed at 27%. Sure, that was a modest slowdown from the prior period's 31% increase, but it still marked the eighth consecutive quarter of growth of at least 25%.

Merchants are finding plenty of value in Shopify's expanding suite of services, even through the latest disruptive tariff-fueled trade disruptions. Merchant solutions revenue jumped 29%, helping lift sales growth above the company's 23% increase in gross sales volumes. "We built Shopify for times like these," company president Harvey Finklestien said in a press release. "We handle the complexity so merchants can focus on their customers."

Shopify is having no trouble converting those market share gains into rising profits, either. Operating income more than doubled to $203 million, and the company achieved a 15% free cash flow margin, up from 12% a year ago.

Concerns over more trade disruptions have likely kept a lid on the stock price following that positive Q1 earnings report in early May. But the company still expects 2025 growth to be in the mid-20s percentage range year over year. Shopify affirmed its initial aggressive outlook for free cash flow, too, although management sees a slightly slower profit increase (in the low-teens percentage rate) ahead for the year.

Investors can look past that minor profit downgrade and focus on Shopify's broader growth story that involves more merchants signing up for more services and booking more transactions on its platform. Success here should make the stock a great one to add to your portfolio in June, with the aim of holding it for the long term.

A Mediterranean feast for growth investors

Anders Bylund (Cava Group): Shares of Cava Group are down more than 40% in the last six months. That doesn't exactly make it a cheap stock, since Cava trades at 69 times earnings and 9.2 times sales even now.

But the Mediterranean fast-casual restaurant chain is growing quickly while reporting profits, and also widening its profit margins over time. That's a lucrative combo that deserves a premium stock price.

Cava's success hasn't gone unnoticed, despite the plunging stock chart. Two-thirds of analysts who follow this stock have issued a "buy" or "overweight" rating, and Wall Street's average target price is 44% above Thursday's closing price.

The company has a habit of absolutely crushing each quarter's analyst estimates across the board, including a huge surprise in May's first-quarter report. The average analyst expected earnings of just $0.02 per share on revenues in the neighborhood of $281 million. Instead, Cava reported earnings of $0.22 per share and $332 million in top-line sales.

A report like that would normally boost Cava's stock, but the market reaction was negative. Management noted that same-store sales growth could slow down in the second half of 2025, since the unpredictable economy is weighing down consumer spending. Cava's healthy salad bowls and pita wraps are on the pricey side, making the chain a vendor of everyday luxuries. This strategy could make Cava vulnerable to shifts in consumer confidence, especially when paired with the stock's lofty valuation.

So you won't find the stock in Wall Street's bargain basement today, but it did move down from the high-end valuation penthouse it inhabited a few months ago. If you like your investments fresh and flavorful, Cava's combination of healthy growth and expanding profits could be a recipe for long-term portfolio success.

42 dividend raises, with more coming up

Neha Chamaria (ExxonMobil): With renewables on the rise, people often believe the oil and gas industry isn't where to bet on anymore. While the global demand for energy overall is only expected to grow, driven by developing countries, ExxonMobil is in a sweet spot. It is working hard to bring down its break-even oil price significantly to stay relevant in the long run. At the same time, it is developing new low-carbon products and solutions.

It believes these new businesses could have potential addressable markets worth $400 billion by 2030 and over $2.3 trillion by 2050. Biofuels, carbon capture and storage, and low-carbon hydrogen are just some of the new products ExxonMobil is focused on.

Overall, ExxonMobil wants to produce "more profitable barrels and more profitable products" and is also cutting costs aggressively. The oil and gas giant believes a better product mix and its cost-reduction efforts combined could add nearly $20 billion in incremental earnings and $30 billion in operating cash flows by 2030.

In short, ExxonMobil is already charting a growth path to 2030 without compromising on capital discipline. It wants to generate big cash flows and maintain a strong balance sheet even through oil market down cycles, and ensure it can continue to reward shareholders with a sustainable and growing dividend on top of opportunistic share buybacks.

ExxonMobil has already proven its mettle when it comes to shareholder returns. It has increased its dividend each year for the past 42 consecutive years. Even without dividends, the stock has more than doubled shareholder returns in the past five years. With ExxonMobil stock now trading almost 20% off its all-time highs, it is one of the top S&P 500 (SNPINDEX: ^GSPC) stocks to buy now and hold.

Ready to rebound

Keith Speights (Energy Transfer): I'm not worried in the least that Energy Transfer LP's unit price is down year to date. This pullback presents a great opportunity to buy the midstream energy stock in June.

Energy Transfer's business continues to rock along. The limited partnership (LP) set a new record for interstate natural gas transportation volume in the first quarter of 2025. Its crude oil transportation volume jumped 10% year over year in Q1. Natural gas liquid (NGL) transportation volumes rose 4%, with NGL exports increasing 5%.

The LP's growth prospects remain solid. Energy Transfer commissioned the first of eight natural gas-powered electric generation facilities in Texas earlier this year. It plans to partner with MidOcean Energy to build a new LNG facility in Lake Charles, Louisiana. Artificial intelligence (AI) is a new growth driver, with Energy Transfer agreeing to provide natural gas to Cloudburst Data Centers' AI data centers.

The Trump administration's tariffs shouldn't affect Energy Transfer much. All of the company's 130,000-plus miles of pipeline are in the U.S. Energy Transfer has already secured most of the steel to be used in phase 1 of its Hugh Brinson pipeline project. Co-CEO Marshall "Mackie" McCrea said in the Q1 earnings call that management doesn't "expect to see any major challenges, if any challenges at all, selling out our terminal every month, the rest of this year."

Even if Energy Transfer's unit price doesn't move much, investors will still make money thanks to the LP's generous distributions. The midstream leader's forward distribution yield currently tops 7.3%. Energy Transfer plans to increase its distribution by 3% to 5% each year.

Should you invest $1,000 in Apple right now?

Before you buy stock in Apple, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Apple wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $651,049!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $828,224!*

Now, it’s worth noting Stock Advisor’s total average return is 979% — a market-crushing outperformance compared to 171% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of June 2, 2025

Anders Bylund has positions in UnitedHealth Group. Daniel Foelber has no position in any of the stocks mentioned. Demitri Kalogeropoulos has positions in Apple and Shopify. Keith Speights has positions in Apple, Energy Transfer, and ExxonMobil. Neha Chamaria has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple and Shopify. The Motley Fool recommends Cava Group and UnitedHealth Group. The Motley Fool has a disclosure policy.

Cava Group (NYSE: CAVA) has proven it deserves a super-premium valuation with its excellent performance across critical business metrics.

*Stock prices used were the afternoon prices of April 10, 2025. The video was published on April 12, 2025.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

Should you invest $1,000 in Cava Group right now?

Before you buy stock in Cava Group, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Cava Group wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $495,226!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $679,900!*

Now, it’s worth noting Stock Advisor’s total average return is 796% — a market-crushing outperformance compared to 155% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of April 10, 2025

Parkev Tatevosian, CFA has no position in any of the stocks mentioned. The Motley Fool recommends Cava Group. The Motley Fool has a disclosure policy. Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.

With the S&P 500 (SNPINDEX: ^GSPC) ending last week down more than 10% in two days, the stock market experienced its first crash since March 2020, when the COVID-19 pandemic began to escalate. The culprit this time was the U.S. enacting punitive tariffs against much of the rest of the world and an ensuing trade war. These tariffs were even applied to two islands uninhabited by humans, with the Trump administration saying the duties were added so that other countries could not evade tariffs by shipping goods through the ports of these islands.

With the market in turmoil and a lot of volatility likely ahead, let's look at four ways investors can navigate the current market crash.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Learn More »

1. Have liquidity

In a bear market or an impending bear market, one of the most important things investors can have is liquidity, or cash on the sidelines. By having available cash, investors can then take advantage of market dips.

If you're fully invested, consider selling some of your least favorite positions to raise some cash that can later be used to buy ideas you have more conviction in. If these are in a non-retirement account, you'd also get the potential benefit of a tax loss when you next file.

To be clear, you don't want to start panicking and just sell stocks. Instead, you want to look at this as an opportunity to high-grade (improve the quality of) your portfolio.

2. Create a list of high-quality stocks to buy

Another important thing you can do is create a list of high-quality stocks and the prices at which you'd start buying them. Undoubtedly, there have been stocks you've liked in the past, but their valuations were too high.

This could be highfliers like Palantir Technologies (NASDAQ: PLTR) or Cava Group (NYSE: CAVA) whose businesses are doing great but whose stock valuations just skyrocketed over the past year or two. Perhaps it could be stocks in industries that have always tended to have high multiplies, such as cybersecurity companies like CrowdStrike (NASDAQ: CRWD) and Palo Alto Networks (NASDAQ: PANW). There could also be blue chip tech names like Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG) or Amazon (NASDAQ: AMZN) whose stocks have just gotten cheaper, given their collection of businesses and future prospects.

The key, though, is to gather a list of high-quality stocks you'd be comfortable owning over the long run. And then, when they reach your price target, be ready to start building positions in them. Just do the research beforehand so you're ready to pounce.

3. Consider writing puts

A more advanced strategy to use in a down market is to write (sell) put options. By writing a put option, you collect a cash premium up front, but you are then obligated to buy that stock if the buyer exercises his option to sell it to you. As such, you want to do this only with stocks and at prices where you would want to buy them.

For example, if Amazon was on your list of stocks to buy at $150, you could write a put on Amazon stock with a strike price of $150 and a May 9 expiration and collect around $3.70 in premium. If the stock falls below $150 and the option is exercised, you'd own the stock at $150. Note that each option represents 100 shares. If Amazon doesn't fall to that price, you just collect the premium, which would be worth around $370 for each option.

This strategy's intention is twofold. One is to let you buy into a stock you want to own at a lower price. However, if the stock never reaches that price, you still earn some return.

The downside to this strategy is that it does tie up some capital, which you could potentially use elsewhere. That is why I prefer to keep the expiration dates short, at about a month.

In addition, if the stock blows past your price target on the downside, you are still obligated to buy at the strike price. This is most likely to occur if a major event happened when the market was closed, and it opened way down. However, the assumption we are using is that you'd be a buyer of the stock at the strike price regardless. The other disadvantage is that if the market does make a quick reversal, you would lose out compared to if you had jumped in right away and bought the stock.

However, this is a nice strategy to supplement your investments, allowing you to earn some extra cash as you wait for stocks to hit your buy prices.

4. Dollar-cost average with ETFs

Another strategy investors should consider is dollar-cost averaging. In this strategy, you make investments at set times and dollar amounts regardless of their prices.

This strategy works particularly well with exchange-traded funds (ETFs) such as the Vanguard S&P 500 ETF (NYSEMKT: VOO) or the Invesco QQQ ETF (NASDAQ: QQQ). These two ETFs track major market indexes that have proven to be long-term winners. The Vanguard ETF tracks the S&P 500, which comprises the 500 largest stocks traded in the U.S., while the QQQ ETF tracks the Nasdaq-100, which is more tech- and growth-oriented.

With ETFs, you don't have to worry about individual stock research. You can buy an ETF that immediately gives you a portfolio of leading stocks. Consistently dollar-cost averaging into index ETFs is a great way to build long-term wealth, and a down market is a great place to start implementing this strategy.

Should you invest $1,000 in S&P 500 Index right now?

Before you buy stock in S&P 500 Index, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and S&P 500 Index wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $590,231!*

Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of April 5, 2025

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Geoffrey Seiler has positions in Alphabet, Invesco QQQ Trust, and Vanguard S&P 500 ETF. The Motley Fool has positions in and recommends Alphabet, Amazon, CrowdStrike, Palantir Technologies, and Vanguard S&P 500 ETF. The Motley Fool recommends Cava Group and Palo Alto Networks. The Motley Fool has a disclosure policy.