Investors can still uncover bargains in the current bull market.
The stock market demonstrated remarkable resilience in 2025. Despite facing trade wars and economic uncertainty, the S&P 500 is hovering near its all-time high. As we approach August, a month historically known for market weaknesses, there are solid companies available at reasonable prices that are worth considering.
If you have $1,000 to allocate to a long-term investment, there are three contributors from Motley Fool that suggest looking into Alibaba, Lululemon Athletica, and VF Corp.
An underestimated tech giant
John Ballard (Alibaba): Alibaba’s stock has started to rebound after a slump over the past few years. This could be a great moment to begin investing in this tech giant. Sino economic recovery and the strong demand for its cloud services are key drivers that might double its stock price in the next five years.
Its e-commerce platforms, Taobao and Tmall, continue to expand in 2025. For instance, the March quarter indicated a 12% year-over-year uptick, primarily fueled by fees charged to third-party sellers, creating a lucrative revenue stream for Alibaba.
The company has various avenues for revenue growth in its e-commerce initiatives including integrating logistics services and launching new software service fees, boosting merchant revenue contributions.
Additionally, robust growth in Alibaba Cloud warrants attention. Rapid AI service adoption has led to triple-digit revenue growth for AI-related products over the past seven quarters. Investments in AI might set the company on a strong growth trajectory in the coming decade.
Despite these positive trends, investors can snag the stock at 13.5 times expected revenue for the year—quite a bargain. If one were to look at a higher revenue multiple, comparable to an average S&P 500 price of 30, there’s potential for the stock to double.
Too cheap to overlook
Jennifer Cybil (Lululemon): Lululemon has faced significant challenges recently, notably a 45% inventory drop in 2025 alone. Yet, it seems the market is underselling this stock, which is currently trading at attractive prices.
Its growth, after years of strong performance, has sharply slowed down due to pressures on discretionary spending and rising competition. Lululemon was once at the forefront of the athletic movement, but the industry has lower entry barriers now, leading customers to seek out the next big brand. Concerns around tariffs have added to the hesitance among investors.
In the first quarter of 2025, which concluded on May 4, sales rose just 7% year-on-year, with comparable sales only increasing by 1%. Worse yet, they dipped by 2% in the Americas. Although management still anticipates mid-digit growth in annual revenues, they have adjusted their earnings per share guidance downward.
However, there’s room for optimism. The stock boasts a P/E ratio of 14, painting it as a value buy at this price point. With an operating margin of 18.5%, even after a dip largely due to tariffs, Lululemon remains more profitable than many peers in the athletic and general apparel sectors.
As tariff situations potentially improve, it’s notable that Lululemon is performing quite well in China, posting a 22% sales increase in the first quarter of last year. Given current pricing, it might be worth reconsidering Lululemon as a stock option, particularly if you’re looking for a value investment.
Signs of a turnaround for VF Corp.
Jeremy Bowman (VF Corp): With the broader markets hitting record highs, it could be a good moment to explore undervalued stocks like VF Corp.
This company, known for brands like Vans, North Face, Timberland, and Dickies, has struggled over the last five years, with stock prices plummeting around 85% since their peak in 2021.
While facing headwinds like a dividend cut and overall challenges in consumer discretionary products, VF Corp. has managed to maintain stable revenue streams. Despite Van’s decline, which led to “channel streamlining,” brands such as Timberland and North Face have shown growth of 11% and 6%, respectively. Overall, the company’s health might be better than it appears.
If management can stabilize Van and enhance profitability, it stands to be in a strong position. The adjusted operating loss was better than anticipated in the first quarter, and guidance suggests year-round growth in adjusted operating profits and free cash flow.
Currently, VF Corp trades at a price-to-sales ratio of only 0.5. Achieving just a 5% profit margin could significantly elevate stock prices, especially for a company with recognized premium brands. If this turnaround continues, the stock could potentially double or triple from now on.
