The Federal Reserve’s fight to curb inflation and return to the monetary policies it introduced at the pandemic’s start has pushed investors to ditch growth stocks into value stocks and cash.
Year-to-date, the S&P 500 has plummeted nearly 18%, with growth stocks continuing to dramatically underperform as the market looks for its bottom. An index of the fastest-growing S&P 500 companies dipped 18% as of Friday, while its value counterpart was down 6%.
“This correction has pushed some growth stocks to extreme dislocations,” said a team of strategists led by Dubravko Lakos-Bujas. As an example, they noted that the fastest-growing stocks are trading at a record 9x price-to-earnings discount relative to the rest of the S&P 500.
Below is a list of 29 stocks from the S&P 500 that JPMorgan says are cheap but have strong growth potential.
The stocks are ranked starting with the highest average growth-at-reasonable-price rating (GARP).
