3 Absurdly Cheap Growth Stocks to Buy in May 2026

The article argues that Novo Nordisk, PDD Holdings, and Intuit are trading at low forward P/E multiples of 13, 8, and 15, respectively, despite continued underlying growth potential. Novo Nordisk has fallen 36% over 12 months amid GLP-1 competition, PDD is down 12% over the past year on tariff and trade concerns, and Intuit is down 36% despite 17% revenue growth in its latest quarter. The piece is broadly bullish on long-term value, but it is opinion-driven commentary rather than new company-specific news.

Analysis

The common setup across these names is not “cheap because broken,” but “cheap because the market is discounting a slower re-rating window than the business cycle actually requires.” That matters: all three have identifiable cash-generating franchises with sticky customer behavior, so the first leg of upside is likely multiple expansion before fundamental acceleration fully shows up. The market is over-penalizing duration risk in businesses where the downside is more likely flat-to-modestly down earnings rather than structural impairment.

The clearest second-order winner is Intuit, because AI is more likely to compress low-trust software than replace high-trust financial workflows. If automation lowers support and onboarding costs, the company can defend pricing while widening its operating margin, which is a better setup than the market’s current “AI disruption” fear implies. Novo is a different kind of setup: the valuation already bakes in a prolonged share loss, so any evidence of stabilized prescriptions or better execution on oral formulations could trigger a violent short-covering move over 3-6 months.

PDD’s asymmetry is more macro-sensitive and less company-specific. Tariffs and trade friction create headline risk, but the more important issue is whether Temu’s demand elasticity can offset incremental friction through pricing, assortment, and localization; if it can, revenue can re-accelerate faster than consensus expects. The contrarian miss is that low multiples here are not necessarily signaling deteriorating businesses — they may simply reflect investors underestimating how quickly sentiment can reverse once earnings stop being revised down.

The biggest risk is that these are all value traps if forward estimates keep falling for another two quarters. In that case, the cheap multiples are optical and the stocks could stay depressed until management can show either stabilizing unit economics or a cleaner guidance reset. For that reason, the best entries are likely staged, not all-at-once, with catalysts clustered around earnings and guidance updates rather than immediate mean reversion.

Key Decisions for Investors

• Start a staged long in INTU over the next 2-4 weeks; use weakness from AI-disruption headlines as entry, targeting a 12-18 month re-rating toward a mid-20s multiple if revenue growth and margins remain intact. Risk: if AI meaningfully reduces mid-market software switching costs, the stock can de-rate further before fundamentals show up.
• Buy NVO on a 3-6 month horizon as a turnaround trade, sized smaller than INTU because the catalyst path is less visible. Best risk/reward comes from waiting for evidence of prescription stabilization or management execution, with upside from a sharp sentiment snapback if the market was too aggressive on competitive fears.
• Hold or initiate a tactical PDD position only as a high-volatility recovery trade over 6-12 months; favor scaling in after tariff-related drawdowns rather than chasing strength. The stock offers leverage to any improvement in cross-border trade assumptions, but the thesis breaks if policy friction starts impairing growth more than expected.
• Pair trade idea: long INTU / short a basket of lower-trust, AI-exposed software names over 6-9 months. The idea is that trusted workflow software should re-rate relative to generic applications if the market continues to overprice AI substitution risk.
• Avoid aggressive shorting of any of the three; the forward multiples are already low enough that downside is likely driven by estimate cuts, not valuation compression. Use options if expressing bearish views, because the asymmetry now favors sharp squeezes on any positive guidance surprise.