With the S&P 500 up by about 16% over the previous 12 months, however the COVID-19 pandemic nonetheless ongoing, many buyers worry one other market crash is imminent.

To be clear, inventory market corrections — speedy, double-digit-percentage worth declines — cannot be predicted with any accuracy. They’re extra frequent than many suppose, although. Broad market declines of 10% or extra happen each 12 to 18 months on common, however costs normally absolutely recuperate inside just a few months.

These short-term fluctuations can provide nice shopping for alternatives to long-term buyers. We requested three Idiot contributors which shares had been on their downturn watch lists. They prompt that Intuitive Surgical (NASDAQ:ISRG), Roku (NASDAQ:ROKU), and CrowdStrike Holdings (NASDAQ:CRWD) could be good buys now, however could be even higher to choose up if the market takes a pointy flip south.

A pioneer of next-gen healthcare know-how

Nicholas Rossolillo (Intuitive Surgical): I feel the healthcare trade is ripe for technological disruption within the subsequent decade, and Intuitive Surgical is without doubt one of the greatest methods to play that coming development. The pioneer of robot-assisted surgical procedure is making a robust comeback after a tough 2020, and it is poised to maintain its momentum for the foreseeable future.

The scheduling of surgical procedures — particularly elective surgical procedures — was disrupted considerably by the pandemic. This was nonetheless an issue for the corporate through the fourth quarter, when recent restrictions had been imposed in some components of the nation to attempt to stem the quickly surging unfold of COVID-19. Intuitive mentioned the variety of procedures utilizing its da Vinci surgical procedure system elevated solely 6% 12 months over 12 months in This fall. That was, nonetheless, an enormous enchancment from the 19% year-over-year decline it reported final spring. And although the variety of new da Vinci programs shipped in This fall was 3% decrease than a 12 months prior, the corporate ended 2020 with an put in system base of 5,989 worldwide — up 7% from the tip of 2019.

The top end result was that its full-year income and internet revenue declined by 3% and 13%, respectively. Not unhealthy, given how horrible a 12 months we simply had. The rise within the variety of da Vinci machines put in means that Intuitive ought to shortly return to progress mode this 12 months. The corporate additionally stays extremely worthwhile (internet revenue was $1.06 billion, with a revenue margin of 24%), giving it the monetary flexibility to maintain creating new procedures for its robotic surgical procedure programs and creating new programs to be used within the medical subject.

In the meantime, the corporate is about to start out lapping the depressed monetary outcomes from a 12 months in the past — teeing it as much as show dramatic year-over-year will increase in income and earnings.  

Granted, Intuitive Surgical’s inventory is pricey. It is presently buying and selling for 81 occasions trailing 12-month free money circulate. However on condition that the corporate is among the many leaders in disrupting the healthcare establishment and driving higher affected person outcomes, there are good causes for it to commerce at a premium. For buyers in search of a strong funding in healthcare that they’ll maintain for the subsequent decade and past, I feel it is a strong purchase proper now — and could be a good higher long-term deal for buyers to choose up if the shares took a steep tumble.

Picture supply: Getty Pictures.

I can not anticipate a juicy Roku low cost

Anders Bylund (Roku): Leisure know-how developer Roku is one among my favourite long-term bets. It is a winner within the media-streaming market, having established itself because the go-to selection when TV makers want a media-management resolution for his or her newest front room centerpieces. The Roku-branded set-top bins and HDMI sticks had been a pleasant begin, however the true cash is within the software program licensing market. That is an extremely scalable enterprise with beneficiant revenue margins, and Roku will get to journey the coattails of content-creation titans comparable to Netflix (NASDAQ:NFLX) and Disney (NYSE:DIS) all the way in which to the highest.

The market has caught on to Roku’s huge enterprise alternative, driving share costs 260% greater during the last 52 weeks. I nonetheless suppose it is a strong purchase at at present’s costs, particularly if you’re constructing your funding positions with a disciplined schedule of small buys over time. And if the inventory all of a sudden drops 20% or extra because of a basic market calamity, I’d be first in line to spice up my Roku holdings.

This vigilant cybersecurity play must be on the prime of your watch record

Billy Duberstein (CrowdStrike): An enormous market pullback is a superb alternative to improve the standard of your portfolio and purchase long-term market leaders. That is why I’d hold my eye on CrowdStrike, which is presently disrupting the high-growth cybersecurity market.

Its endpoint safety product was constructed with a cloud-first, AI-based structure supreme for at present’s enterprise setting. Its light-weight Falcon agent may be hooked up to any endpoint, whether or not a cloud server, laptop computer, telephone, or company server. Each Falcon agent then stories again to CrowdStrike’s centralized Menace Graph, which makes use of AI to repeatedly tweak its algorithms and reply to new threats in actual time.

CrowdStrike has turn out to be a transparent chief and disruptor within the endpoint safety market, which continues to be fragmented and has a protracted approach to go. Although it has been greater than doubling its buyer depend yearly for a number of years already, CrowdStrike nonetheless managed to develop its buyer depend by 85% year-over-year final quarter, and enhance its subscription income by 88% over the earlier 9 months.

Furthermore, administration is engaged on new “modules” — proper now, there are 11 — providing it alternatives to upsell these purchasers on complementary providers past endpoint safety. Again in September, CrowdStrike purchased Preempt Safety, a frontrunner in identification administration. After which final week, it made a much bigger and bolder acquisition — safety start-up Humio, a frontrunner in one thing referred to as XDR, or eXtended Detection and Response.

XDR tackles the issue of getting an excessive amount of information coming at prospects all of sudden. Bringing Humio’s merchandise into its system ought to allow CrowdStrike to raised filter out these plenty of pointless information and ship extra helpful, actionable insights to its purchasers.

The unlucky Solarwinds (NYSE:SWI) hack that was revealed in early December put a good larger concentrate on cybersecurity broadly. In response, Solarwinds truly selected CrowdStrike to repair its downside and guard its community. Unsurprisingly, the corporate’s inventory soared within the aftermath of that information — and it had already gone up so much previous to that in 2020. The corporate presently trades at a whopping 68 occasions gross sales, which is an extremely costly valuation.

That being mentioned, CrowdStrike is a best-in-class disruptor with excessive gross margins and an enormous tailwind, so a premium valuation is considerably warranted. Due to this fact, buyers ought to look to scoop up this premier cybersecurity play on any massive market pullback that takes CrowdStrike’s share worth down with it.