Nasdaq Correction: 2 Winning Stocks on Sale Right Now

The Nasdaq Composite has recently entered correction territory, falling more than 10% below its recent bull-market high. This downturn, driven by uncertainty surrounding U.S. trade policy and plummeting consumer sentiment, has created a unique opportunity for long-term investors. While the market's volatility may be unsettling, it also presents a chance to buy high-quality stocks at discounted prices. In this article, we will explore two Nasdaq stocks that are currently on sale and have strong growth prospects despite the market correction.



The Trade Desk: A Leader in Ad Tech

The Trade Desk (TTD) is a standout in the ad tech industry, providing a demand-side platform (DSP) that uses artificial intelligence to help ad agencies and brands automate, measure, and optimize data-driven campaigns across digital channels. Despite a 60% decline from its record high reached in early December, the trade desk remains a strong investment opportunity. The median target price on Wall Street is $112 per share, implying 100% upside from its current share price of $56.

The Trade Desk's leadership in the ad tech industry is evident in its recent financial performance. In the fourth quarter of 2024, revenue increased by 22% to $741 million, although management had guided for $756 million. Non-GAAP net income still rose by 44% to $0.59 per diluted share, ahead of what analysts anticipated. CEO Jeff Green attributed the revenue shortfall to a "series of small execution missteps" and detailed changes the company has made to fix the issues, including a reorganization to streamline reporting and adding more AI features to the platform.

The Trade Desk's independence as a DSP is a significant advantage. Unlike competitors that own advertising inventory, The Trade Desk has no conflict of interest and can focus on providing the best possible service to its clients. This independence, combined with its strong financial performance and leadership in the ad tech industry, makes The Trade Desk a compelling investment opportunity during the current market correction.

Datadog: Observability Software for the Modern Enterprise

Datadog (DDOG) is another Nasdaq stock that has seen a significant decline in its share price, falling 39% from its record high reached in December. However, the median target price on Wall Street is still $160 per share, implying 55% upside from the current share price of $103. Datadog provides observability software that brings together dozens of software products, allowing businesses to monitor IT infrastructure and resolve performance problems.

Datadog's strong financial performance and leadership in the observability software industry make it a compelling investment opportunity. In the fourth quarter of 2024, revenue grew by 30% year-over-year, and the company's adjusted free cash flow for fiscal 2025 was $942 million. Datadog's observability software is in high demand as businesses increasingly rely on digital infrastructure to operate. The company's ability to provide a comprehensive solution for monitoring and resolving performance problems positions it for long-term growth.



Conclusion

The recent market correction has created a unique opportunity for long-term investors to buy high-quality Nasdaq stocks at discounted prices. The Trade Desk and Datadog are two standout companies that have strong growth prospects despite the market volatility. The Trade Desk's leadership in the ad tech industry and Datadog's comprehensive observability software make them compelling investment opportunities during the current market correction. As the Nasdaq has historically recovered from every past correction, patient investors who treat the drawdown as a buying opportunity are likely to benefit from the strong fundamentals of these companies.

Ask Aime: Why are The Trade Desk and Datadog attractive investments during the current market correction?