The S&P 500 and the Dow climbed Thursday morning in an attempt to rebound from their toughest three-day stretch since October. The Nasdaq also popped to stop some of the bleeding, with it down over 7% from its April 26 records.

Wednesday’s big pullback followed increased inflation fears, with Wall Street worried the Fed might be forced to raise interest rates. The consumer-price index jumped 4.2% in April from a year earlier. This represented the largest 12-month jump since the summer of 2008 and came above expectations.

Wall Street appears more nervous about inflation amid the U.S. economic resurgence, boosted by the vaccine push, pent-up demand, easy money policies, and government checks. Yet the Fed remains steadfast that inflation will be “transitory” and retreat later this year since current prices are compared against the early shock of the coronavirus and are made worse by supply chain setbacks.

The prospect of higher interest rates has spooked technology investors. But the Fed has continued to voice its commitment to ultra low rates and its new “average inflation targeting,” which means the central bank will allow inflation to run above its 2% target for some period of time.

Investors should remember that even it rates were to climb again, they will likely remain historically low, forcing the continuation of TINA, or there is no alternative investing. The market also never just goes up and Wall Street is always going to take profits. The Nasdaq has already suffered and recovered from a correction in 2021 that was sparked by inflation worries.

The big players in the market use downturns to load up on companies they love at a lower price. Given this backdrop, investors with long-term horizons might want to consider buying strong tech stocks at discounts even if there is more selling, or at least add them to their watchlist to strike when comfortable…

Roku

ROKU

Roku is one of the only pure-play streaming TV stocks outside of Netflix

NFLX

. Roku became known for its small devices that plug into TVs and allow users to watch streaming TV content, with its tech also built into smart TVs. Roku was the No. 1 smart TV OS sold in the U.S. in 2020, with nearly 40% market share. It also sells wireless sound systems that compete alongside Sonos

SONO

and others. Plus, the Roku Channel allows users to watch free, ad-supported streaming movies and TV shows.

More importantly, Roku makes money by selling ad space across its marketplace and taking a share of streaming service subscription revenue and ad inventory. Roku enables marketers to buy targeted ads, promote their streaming movies or platforms, and more.

Wall Street has taken notice since digital advertising is the future. Digital accounted for one-third of ad spending only a few years ago. EMarketer now projects digital will account for 65% of the roughly $240 billion-a-year industry in the U.S. by 2023.

Roku stands to benefit from the growth of the entire industry, no matter who has the hot show or more users. The booming streaming TV market helped Disney

DIS

blow away its own subscriber goals and has seen Netflix amass over 200 million subscribers. The industry’s other players are some of the biggest companies in the world, including Amazon

AMZN

and Apple

AAPL

.

Roku topped our Q1 estimates on May 6, with revenue up 79%. The company’s +$0.54 a share adjusted earnings also blew away our bottom-line estimates that called for a -$0.12 loss. Meanwhile, its ad-heavy platform revenue soared 101% to account for 80% of total sales and it added 2.4 million active accounts to close at 53.6 million. And Roku’s monetized video ad impressions more than doubled YoY.

Roku’s consensus fiscal 2021 EPS estimate soared 182% since its report, with its FY22 figure up 114%. Zacks estimates call for Roku’s FY21 revenue to surge 53% from $1.8 billion to $2.7 billion, with it set to add another $1 billion, or 39% to end 2022 at $3.8 billion. And it’s projected to swing from an adjusted loss of -$0.14 a share to +$0.28 this year, with FY22 set to soar to $0.90 a share.

ROKU popped following its recent release, but it’s still down 35% from its mid-February records at $312 a share. The stock bounced out of oversold RSI territory (30) after earnings, but at 40 it sits far below neutral levels. ROKU also trades at a discount to its own year-long median and 40% below its year-long highs at 13.6X forward sales.

Despite its recent downturn, as Wall Street sold high-flying growth stocks, ROKU is up 170% in the last year and 790% in the past three. Roku currently lands a Ranks #3 (Hold), alongside an “A” for Momentum and “B” for Growth in our Style Scores system.

Snap Inc.

SNAP

Snap has continually enhanced its social media app that became famous for disappearing photos and videos. Today, Snapchat is full of video content and shows from social media stars to celebrities like Kevin Hart and Ryan Reynolds, as well as mega brands like the NFL, Disney, and many others.

Snapchat’s Discover page has gained traction and it’s been in the booming mobile gaming market for over two years. The company also constantly releases various augmented reality offerings and it launched its Spotlight feature late last year that aims to challenge TikTok.

Snap’s beefed-up portfolio of entertainment offerings has attracted advertisers as more people disconnect from ad-supported legacy media and simply ignore more traditional online banner ads. Investors should also know that Snap has boasted that in the U.S. it reaches “more than 90% of 13-to-24-year-olds and more than 75% of 13-to-34-year-olds.”

Snap’s ability to reach this “unduplicated and hard-to-reach audience” has attracted Wall Street’s attention, as it continues to add users and monetize its growing platform, while Facebook

FB

and other giants face government scrutiny. Snap beat our estimates on April 22, with revenue up 66% and its daily active users up 22% to 280 million. The company also posted break-even earnings to top our estimate that called for a loss of -$0.06 a share.

Snap’s FY21 and FY22 earnings estimates have climbed by 83% and 17%, respectively since its report. Zacks estimates call for Snap’s FY21 revenue to surge 56% to reach $3.9 billion, with FY22 projected to climb another 49% to $5.8 billion. These estimates would represent its best growth as a public company and follow three-straight years of between 43% to 46% revenue expansion.

The company is expected to soar from an adjusted loss of -$0.06 a share last year to +$0.22 in fiscal 2021, with 2022 set to skyrocket 194% +$0.65 a share. Like Roku, Snap lands a Zacks Rank #3 (Hold), accompanied by a “B” grade for Growth. Plus, 21 of the 26 brokerage recommendations Zacks has for Snap are “Strong Buys,” with none below a “Hold.”

SNAP has climbed 200% in the past year, but it fell victim to the growth selling that began in February. The company’s $51 a share price tag puts it 30% below its records of over $70 a share. And its RSI of 37 gives it plenty of room to run before it even reaches neutral levels. On the valuation front, Snap trades at a 35% discount to its own year-long highs at 17.1X forward 12-month sales, which is below its median as well.

Clearly, there could be more selling pressure. But investors thinking about making long-term plays might consider the constantly-adapting the modern media platform that plays into overall smartphone addiction and attracts a vital demographic in the new age of entertainment.

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