Growth stocks have taken a serious beating in 2025—and even the strongest names haven't been spared. That’s been down to the uncertainty surrounding President Trump’s tariff war and the fears of recession.
Arista Networks Inc. (NYSE: ANET) is down nearly 36% year-to-date (as of 23 April 2025). PayPal Holdings, Inc. (NASDAQ: PYPL) Off by almost 27%. Even enterprise titan like ServiceNow, Inc. (NYSE: NOW) has slipped more than 23%. These are big, well-run companies with real revenue, strong free cash flow, and massive long-term potential. Yet they've been tossed aside by a market laser-focused on macro fear and short-term noise.
But here’s the thing savvy investors know: Wall Street’s overreactions often open the door to some of the market’s best opportunities.
When great companies go on sale—not because of broken business models, but because of temporary headwinds—that’s when long-term investors should lean in, not back away.
So, here’s a closer look at three beaten-down growth stocks that could reward patient buyers in a big way.
1. Arista Networks (NYSE: ANET)
AI infrastructure doesn’t build itself—and Arista is the one wiring the future. Arista Networks might not have the glitzy brand appeal of an Nvidia Corporation (NASDAQ: NVDA) or the consumer buzz of a Meta Platforms Inc (NASDAQ: META), but if you're bullish on the rise of artificial intelligence, Arista should be firmly on your radar.
This networking powerhouse is the silent enabler of hyperscaler infrastructure, and it's already working with the likes of Microsoft Corporation (NASDAQ: MSFT) and Meta to build out next-gen AI data centres.
Yes, shares are down 30% this year, but that’s more about macro jitters (like trade tensions and hyperscaler belt-tightening) than business fundamentals.
In fact, Arista is growing its earnings before interest, tax, depreciation and amortization (EBITDA) at a 25% clip. Not bad for a company riding a secular wave of AI networking demand.
With Ethernet switching sales expected to grow in the double digits and Arista’s market share expanding, this could be a classic case of short-term pain, long-term gain.
2. PayPal Holdings (NASDAQ: PYPL)
When everyone else zigs, this payments giant is quietly resetting for a comeback. Let’s face it—PayPal has been through the wringer. Once a fintech golden child, it’s now nearly 80% below its all-time high, and investors have largely tuned out. But that might be a mistake.
Here’s why: PayPal is still raking in billions in free cash flow, still has over 430 million active users, and now trades at just 12.3 times forward earnings. That’s value stock territory for a tech company with serious network effects.
Management is pivoting hard. It’s streamlining the platform, reworking Venmo, and doubling down on partnerships. Execution risks remain, sure—but the risk/reward setup looks skewed in favour of the brave. Sometimes the best returns come from betting on the unloved.
3. ServiceNow (NYSE: NOW)
This isn’t your average SaaS company—it’s an enterprise AI juggernaut in disguise. ServiceNow’s recent Q1 2025 results were a masterclass in execution.
While most enterprise software names are cautiously navigating the macro storm, ServiceNow is pressing forward, posting a record US$3.09 billion in revenue, 20% year-on-year subscription growth, and 48% free cash flow margins.
Even more impressive? The number of customers paying $5 million+ annually has crossed 500. That’s the kind of “land and expand” customer base Wall Street dreams about.
From AI-powered workflow tools (Now Assist) to new database products (RaptorDB) and a broader CRM suite, ServiceNow is rapidly widening its moat.
And with operating margins north of 30% and raised full-year guidance, the company is proving that growth and profitability can coexist—even in tough times.
Bottom line
Growth stocks may be out of fashion right now, but that won’t last forever. Arista, PayPal, and ServiceNow are three companies with real moats, strong fundamentals, and powerful long-term tailwinds behind them. Their stock prices might be down, but their futures? Anything but.
If you're a long-term investor looking to capitalise on market dislocation, these names might just be your ticket to the next wave of upside. These former high-flyers have taken a beating—but their long-term stories are far from over.
* The content presented above, whether from a third party or not, is considered as general advice only. This article should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments.
