The U.S. inventory market simply completed its worst first half since 1970. Amid a drawn-out decline that started within the latter phases of 2021, many shares have been beneath strain for the majority of the previous yr. The S&P 500 has fallen by nearly 13% over the previous 12 months and is down greater than 20% from its January peak. That downward strain may persist within the weeks and months forward, as inflation stays an enormous downside.

Lengthy-term buyers may find yourself being the large winners from this bear market, although, as a result of those that purchase the suitable shares at at present’s discounted ranges and maintain onto them may take pleasure in some unbelievable earnings. Three shares that I see as being among the many finest discount buys at present are Trulieve Hashish (TCNNF 5.66%), Restaurant Manufacturers Worldwide (QSR -0.73%), and Airbnb (ABNB -3.19%).

1. Trulieve Hashish

Trulieve Hashish is a number one firm within the marijuana trade. It has greater than 160 places throughout the nation, the highest amongst multi-state operators. (Rival Curaleaf reported 128 places as of the tip of March.)

Most of its places are in Florida, a state that hasn’t even legalized marijuana for leisure use but, and it does not appear like that can change this yr. However greater than three-quarters of Florida residents assist legalizing leisure use, so it is solely a matter of time earlier than the leisure market opens up there. And when it does, that can immediately put Trulieve in a wonderful place to take benefit and speed up its development.

Although the enterprise has been rising, Trulieve’s inventory is down 70% over the previous yr. Marijuana shares broadly have carried out poorly over that stretch: The trade benchmark Horizons Marijuana Life Sciences is down by 66% over the previous yr.

This yr, Trulieve administration anticipates that gross sales will land between $1.Three billion and $1.Four billion, up from $938 million in 2021. That development will come largely from its acquisition of multi-state marijuana operator Harvest Well being, which Trulieve closed on in October. The transaction has broadened Trulieve’s enterprise and set it up for much more development alternatives all through the nation.

Buying and selling at simply 1.Eight instances income, Trulieve appears like a relative discount, because it has traditionally traded above a a number of of three. And as soon as the leisure pot market in Florida opens for enterprise, buyers will doubtless pay extra of a premium for the inventory given the corporate’s robust presence within the Sunshine State. Shopping for the inventory effectively earlier than that occurs might be a terrific transfer for long-term buyers.

2. Restaurant Manufacturers Worldwide

Restaurant Manufacturers Worldwide owns Burger King, Popeyes, Tim Hortons, and Firehouse Subs. After a tough few years because of the pandemic, the corporate might be in a main place to learn as persons are desperate to get again to their former routines. And amid this era of excessive inflation, Restaurant Manufacturers’ modestly priced fast-food chains provide customers engaging choices.

Circumstances have been trying good for the corporate by way of the primary three months of 2022. Its comparable gross sales development of 8.4% was a pointy reversal from the two.3% decline the corporate reported within the prior-year interval. Its fastest-growing chains have been additionally its largest — Tim Hortons and Burger King, which generated year-over-year gross sales development of 16.8% and 9%, respectively.

Previously yr, Restaurant Manufacturers Worldwide’s inventory declined by 20%. Buying and selling at simply 19 instances earnings, it is comparatively low-cost now. It has typically traded at greater than 25 instances earnings in years previous. An added incentive to load up on the inventory is that within the wake of that drop in worth, its dividend now yields 4.2% — effectively above the S&P 500’s common yield of 1.7%.

3. Airbnb

One other restoration inventory that appears good at present is Airbnb. Its shares have fallen by 40% previously yr, however there are at present extra causes to purchase it than to promote. As with Restaurant Manufacturers Worldwide, there are indicators that this journey firm’s restoration is already effectively underway. 

Within the first quarter, Airbnb reported year-over-year gross sales development of 70% with income totaling $1.5 billion. That was additionally 80% higher than its pre-pandemic Q1 2019 end result. It additionally generated document free money stream of $1.2 billion in its most just lately reported quarter.

Airbnb is not constantly worthwhile but, so it isn’t helpful to take a look at its price-to-earnings ratio. However when it comes to its price-to-sales ratio — now slightly below 9 — it hasn’t traded decrease because it went public in 2020. Between its modest valuation and the pent-up demand for journey that buyers might be making ready to fulfill, Airbnb is an underrated inventory to purchase proper now.