Key Takeaways:
- The Trade Desk stock is down 48% in 2025, but analysts believe it has nearly 85% upside from current prices.
- PayPal continues to underperform, but analysts still see a 34% upside as the company focuses on improving profit margins.
- Despite the recent tech sell-off, Shopify’s fundamentals remain strong. With 20%+ annual growth expected, analysts see nearly 25% upside.
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Market downturns create opportunities for astute investors to buy high-quality companies at discount prices. The recent market volatility has hit some of the most promising tech stocks particularly hard, creating potential buying opportunities.
According to analysts, here are three oversold stocks with significant upside potential. Stock #1 offers the most immediate upside, but all three companies have strong long-term growth prospects.
1: The Trade Desk (TTD)
The Trade Desk is a leading digital advertising technology company that provides a platform for ad buyers to optimize their campaigns across multiple channels.
Despite its strong business fundamentals, the stock has plummeted over 50% in the past three months after the company missed revenue guidance for the first time in years.
Why The Trade Desk could be a compelling opportunity:
- TTD is a dominant player in programmatic advertising, particularly in the growing connected TV market.
- The recent sell-off has brought the forward P/E ratio down from 66 to a more reasonable 33.
- Analysts see nearly 85% upside from current prices, with a median price target of $112 per share.
The Trade Desk’s primary advantage is that it is the largest independent demand-side platform (DSP) in the industry. Unlike competitors such as Google, the Trade Desk doesn’t own advertising inventory, eliminating conflicts of interest when recommending ad placements.
CEO Jeff Green has acknowledged recent “execution missteps” and implemented organizational changes to address these issues, including streamlining reporting structures and engaging more directly with brands rather than working exclusively through agencies.
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2: PayPal (PYPL)
PayPal is one of the largest digital payment platforms in the world, processing billions of transactions annually.
PYPL stock has declined over 40% in the past three years, but several catalysts could drive a significant recovery soon.
Why PayPal looks undervalued today:
- The stock trades at 14 times expected earnings despite projected annual earnings growth of over 10%.
- New CEO Alex Chriss is implementing strategic changes focused on profitable growth and margin expansion.
- Analysts expect the stock to have approximately 34% upside from current levels.
Since taking over in late 2023, CEO Alex Chriss has been making significant changes to reinvigorate growth.
PayPal’s focus on profitability over volume growth demonstrates its commitment to sustainable, high-margin expansion. While this approach may result in slower revenue growth in the short term, it should lead to stronger earnings growth and shareholder returns over time.
With over 430 million active accounts globally and strong brand recognition, PayPal benefits from powerful network effects. The company’s peer-to-peer payment app Venmo continues to gain traction, with management targeting $2 billion in Venmo revenue by 2027.
PayPal’s strong free cash flow generation—expected to reach approximately $6 billion in 2025—provides ample resources for share repurchases and strategic investments.
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3: Shopify (SHOP)
Shopify powers over one million businesses worldwide with its comprehensive e-commerce platform. It offers solutions for online stores, payments, marketing, and inventory management.
Despite the recent sell-off in tech stocks, Shopify’s fundamentals remain robust, with strong growth across all key metrics.
Why Shopify continues to be a compelling investment:
- Shopify dominates the U.S. e-commerce platform market with a 30% share.
- Revenue and earnings are expected to grow over 20% annually for several years.
- Analysts have set price targets averaging about $136 per share, representing nearly 23% upside.
Shopify processed over $94.5 billion in gross merchandise volume (GMV) in Q4 alone, bringing its full-year total to $292.3 billion, up 24% from the previous year. Revenue reached nearly $9 billion for 2024, a 26% increase from 2023, while net income surged to over $2 billion.
As e-commerce continues to grow as a percentage of retail sales—projected to reach 21.4% by 2029, up from 17.3% in 2024—Shopify is well-positioned to benefit from this secular trend. The company’s expansion into omnichannel solutions that bridge online and offline commerce further strengthens its competitive position.
While trading at approximately 73 times next year’s expected earnings of $1.49 per share, Shopify’s premium valuation is justified by its market leadership position and consistent execution in a large and growing addressable market.
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TIKR Takeaway
The Trade Desk, PayPal, and Shopify represent high-quality businesses caught in the recent market volatility, creating potential buying opportunities for long-term investors.
The TIKR Terminal offers industry-leading financial data on over 100,000 stocks and was built for investors who think of buying stocks as buying a piece of a business.
Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
