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With the US stock market reaching record highs this year, investors have seemingly started taking profits as concerns of an increasingly shaky economic environment ramp up alongside fears of an AI bubble. And, unsurprisingly, growth stocks are taking some of the biggest hits.
But could this have created lucrative buying opportunities?
The stage is set for a potential correction
Meta saw its share price slump 16% on the back of its latest earnings. Netflix dropped by double-digits, The Trade Desk also stumbled, along with Advanced Micro Devices, Palantir, and even Nvidia. Meanwhile, it’s been nothing but a horror show for shareholders of Trex and elf Beauty, both down over 30%.
Since then, some of these businesses have begun bouncing back. And the S&P 500 as a whole is still showing some resilience now that the US government shutdown is seemingly close to a resolution.
But with a substantial backlog of critical inflation, employment, and economic data, investor sentiment could quickly turn sour if a wave of negative insights suddenly hits the markets all at once.
So far, the US economy has proven to be quite resilient. And if the delayed data continues to reveal better-than-expected performance, US stocks could continue to climb higher. Nevertheless, I believe the overall level of risk is rising.
There are still buying opportunities
Despite stretched valuations, there are still plenty of US growth stocks that remain attractive. And one business I’ve steadily been topping up on over the last few months is Sezzle (NASDAQ:SEZL).
As a quick introduction, Sezzle’s a Buy Now Pay Later (BNPL) platform targeted towards Millennials and Gen Z operating in North America as an interest-free alternative to credit cards. And unlike other BNPL companies, Sezzle operates with a consumer-focused subscription business model.
The bulk of revenue still comes from transaction fees. But around a quarter of the group’s cash flow actually stems from recurring monthly subscriptions that allow users to execute BNPL transactions at any merchant in the country using a virtual or physical Visa-powered debit card.
This rather unique way of doing business means that not only is Sezzle profitable, but it also has some of the highest profit margins in the entire BNPL industry.
| Profit Metric | Value |
| Gross Profit Margin | 85.3% |
| Operating Profit Margin | 37.9% |
| Net Profit Margin | 28.4% |
Fierce competition
Despite the strong financials, Sezzle shares have been stuck on a downward trajectory these last few months.
Some of this is undoubtedly profit-taking. Fun fact: between July 2024 and July 2025, the stock surged more than 1,100%! But some of this is also undoubtedly linked to competitive threats.
A key rival – Klarna – recently made its debut on the US stock market and is a giant processing over $100bn in gross merchandise volumes compared to Sezzle’s $2.5bn in 2024. And with far deeper financial pockets, there’s a growing question of how Sezzle can be successful in this ‘David versus Goliath’ story.
So far, Sezzle’s results suggest it’s holding its own, carving out a niche within the BNPL space. And while the company’s certainly sensitive to the US economic climate, at a forward price-to-earnings ratio of just 14.1, Sezzle looks like one of the cheapest explosive growth stocks on the US stock market right now, in my opinion.
That’s why I’ve already started steadily buying shares. But this isn’t the only exciting opportunity I’ve got my eye on right now.
