The Motley Fool·2025-04-21 11:15Group 1: Market Overview - The recent stock market sell-off has left nearly all stocks down from their all-time highs, creating a buying opportunity for long-term investors [1][2] - Stocks that were already undervalued before the sell-off now appear exceptionally cheap [2] Group 2: Investment Opportunities - Three stocks identified as bargains are Alphabet (GOOG), Taiwan Semiconductor (TSM), and Adobe (ADBE), all trading significantly below their historical highs without justifiable reasons [2][4] - The S&P 500's forward P/E ratio of 20.2 serves as a baseline for determining "cheap" stocks, with the mentioned companies trading below this mark [3][4] Group 3: Alphabet (GOOG) - Alphabet trades at a forward P/E ratio of 17.5, which is historically low and reflects its dependence on cyclical advertising revenue [5][7] - Recent court rulings deeming Google's ad network and search engine as illegal monopolies contribute to its current low valuation, although the company plans to appeal [10][11] - Despite uncertainties, Alphabet's dominant position in the advertising space and potential breakup value suggest it remains a viable investment [11] Group 4: Adobe (ADBE) - Adobe's valuation has decreased significantly, with its trailing P/E ratio at a decade low, indicating a shift from a growth to a value company [12][14] - Concerns about competition from generative AI platforms have not yet materialized, and Adobe's growth remains steady at around 10% [12][14] Group 5: Taiwan Semiconductor (TSM) - Taiwan Semiconductor trades at a forward P/E ratio of 17, which is considered a bargain for a leading chip fabricator [15][18] - The company is investing $100 billion to expand its U.S. manufacturing footprint, which may mitigate potential tariff impacts [15][18] - Despite market concerns, Taiwan Semiconductor's long-term growth trajectory remains strong, making it an attractive investment opportunity [18]