The saying “what goes up must come down” is evident in the current state of the Nasdaq Composite Index, which is approximately 13% below its all-time high, thus entering correction territory.
Despite this downturn, many stocks within the Nasdaq that have seen significant declines still show promising growth potential. Below are three Nasdaq stocks that have dropped by 20% or more, which investors may come to regret missing out on during this dip.
1. Alphabet
Shares of Google’s parent company, Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL), have decreased by 23% from their recent peak. This drop may stir fears about the company facing significant challenges from generative AI and regulatory pressures. However, this is not a sign of impending doom for Alphabet; rather, it appears to be a great buying opportunity.
Concerns about Google’s future were amplified after the launch of ChatGPT by OpenAI in late 2022. Nevertheless, Alphabet remains a formidable force in the AI sector, recently introducing AI Overviews that integrate generative AI with search capabilities. Presently, these features are utilized in over 100 countries, enhancing user satisfaction and increasing search activity on Google, as noted by CEO Sundar Pichai.
While critics highlight that Google Cloud ranks third in market share, it’s important to note that it is outpacing its competitors in growth. The introduction of Google Gemini, a large language model (LLM) rivalling ChatGPT, drives this growth trend. Additionally, many fail to recognize the significant potential of Alphabet’s Waymo unit, a leader in the autonomous ride-hailing market, which is projected to grow substantially as it enters new cities.
2. Amazon
Amazon (NASDAQ: AMZN) is another stock categorized among the “Magnificent Seven” that has experienced a downturn, with shares falling about 21% from their February 2025 peak. Historically, investing in Amazon during price pullbacks has proven profitable, and I believe it will be beneficial again.
While Google Cloud struggles in the cloud services market, Amazon Web Services (AWS) firmly holds the top position, despite slower growth due to increasing competition. However, AWS still recorded impressive growth, with sales rising by 19% year-over-year in Q4 of 2024. Alongside its cloud offerings, Amazon’s e-commerce segment, driven by the popularity of Amazon Prime, continues to demonstrate considerable growth potential.
Moreover, Amazon’s ongoing diversification efforts into new markets, particularly in healthcare and self-driving technology, are anticipated to yield significant returns over the coming decade.
3. The Trade Desk
The Trade Desk (NASDAQ: TTD) has faced substantial losses recently, with shares dropping over 60% from their late 2024 peak as a result of a disappointing revenue update in Q4. The overall market decline has also contributed to this downturn, but I believe the sell-off is overblown.
Despite missing revenue targets in its Q4 update, The Trade Desk still achieved 22% revenue growth. CEO Jeff Green took responsibility for the shortfall but attributed it to minor execution errors rather than market demand or competition. He is optimistic that the company’s best days are ahead, and I share that sentiment.
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John Mackey, former CEO of Whole Foods Market, which is an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is also a board member. Keith Speights holds positions in Alphabet, Amazon, and The Trade Desk. The Motley Fool is invested in and endorses Alphabet, Amazon, and The Trade Desk. The Motley Fool has a disclosure policy.
The opinions expressed are those of the author and do not necessarily reflect those of Nasdaq, Inc.