ROAD - Buying These 3 Beaten-Down Growth Stocks on the Dip Is a Genius Move
The ups and downs of real estate stocks tend to have a close relation to the ups and downs of interest rates. Real estate prices and demand grew by double-digit percentages in 2020 and 2021 as the pandemic led to lowered rates. In turn, real estate stocks with direct exposure to this fast-growing industry soared. But the Federal Reserve raising the Prime Lending Rate in early 2022 to help combat outsized inflation immediately put pressure on real estate stocks (as well as most of the stock market).
Traders react swiftly to bad news, and sometimes they overreact. Three stocks that have taken an especially tough beating are Innovative Industrial Properties (NYSE: IIPR) , Construction Partners (NASDAQ: ROAD) , and Gladstone Land (NASDAQ: LAND) . All three stocks are trading down 23% or more over the past year. Short-term traders punished these real estate stocks, making for a potentially great opportunity to buy for long-term investors.
Here's a closer look at each company and why three Motley Fool contributors believe they are fantastic buys for growth in the coming years.
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Buying These 3 Beaten-Down Growth Stocks on the Dip Is a Genius Move