With the holiday shopping season upon us, it’s time for investors to celebrate. There’s no better way to do so than to look at some retail stocks to buy whose share prices were once shining brightly but have fallen on hard times in 2022.

The holiday season officially got started on Thanksgiving Day. However, with many retailers opting to close for the holiday, Black Friday was the real opening day of this year’s holiday season. It’s now a sprint to Christmas Eve. 

Retail experts’ early reports suggest traffic on Black Friday, while brisk, wasn’t a grand slam home run, with few long lines or packed mall parking lots emerging from the long weekend of shopping. 

A big winner on Black Friday this year was online shopping. According to Adobe Analytics data, Americans spent more than $9.1 billion online on Friday, 2.3% higher than last year.

To make my list of three fallen-star stocks to buy heading into the holidays, a retail stock must be down in 2022 while up in 2021. 

Happy Holidays! 

Amazon (AMZN)

There was a time when Amazon (NASDAQ:AMZN) stock could do no wrong. Down nearly 45% in 2022, investors are beginning to have doubts about the e-commerce giant, despite the fact that its AWS (Amazon Web Services) business continues to generate huge profits. 

Things have gotten so bad for Amazon that Walmart (NYSE:WMT) got more online searches on Black Friday this year. On Black Friday in 2021, Amazon finished first in online searches for Black Friday discounts. This year, Amazon came fourth behind Walmart and two other omnichannel retailers. 

Despite the woes faced by Amazon — it doesn’t help that it laid off 10,000 employees in November — its overall businesses remain strong. 

MoffettNathanson analyst Michael Morton had good things to say about Amazon in mid-November, suggesting that it’s still the best e-commerce stock to bet on heading into 2022. Morton has an outperform rating for Amazon with a $118 target price, 24% higher than where it’s currently trading.

Of the 51 analysts covering Amazon stock, 48 rate it as “overweight” or an outright buy. The average target price is $137, 48.8% higher than its current share price. It’s expected to earn $1.83 in fiscal 2023. 

One segment to keep an eye on is advertising. In 2021, its ad business grew 58% to more than $31 billion, trailing only Google and Facebook in the lucrative U.S. online ad market. It is now the company’s second-biggest profit generator behind AWS, providing it with an excellent one-two profit punch.

Buying under $100 will pay dividends in the long run.

Home Depot (HD)

Next on my list of stocks to buy is a home improvement giant. Home Depot (NYSE:HD) gained 56% in 2021 due to a booming housing market. In 2022, as housing has seen an accelerated slowdown due to rising interest rates, HD stock is down more than 30% year-to-date. 

On the top line, the home improvement retailer delivered better-than-expected third-quarter results on Nov. 15. Revenue was $38.9 billion, nearly 6.0% higher than a year earlier, and $870 million better than the consensus estimate. On the bottom line, it earned $4.24 in Q3 2022, 10 cents higher than analyst estimates. 

Despite the economy appearing to slow, Home Depot is confident that it will weather the storm as homeowners spend more time at home, justifying home renovation projects. 

Home Depot director Paula Santilli recently purchased 1,583 shares on the open market for $315.80 a share. That is Santilli’s first open market purchase since joining the board on March 1. So far in 2022, she’s also received 799 deferred shares, which vest after she’s left the board.

There’s only one reason a director buys shares on the open market: They think the shares are good value. 

In November, Home Depot’s competitor Lowe’s (NYSE:LOW) sold its Canadian operations to private equity firm Sycamore Partners for $400 million. Lowe’s paid 3.2 billion CAD in 2016 for Rona Inc. (TSX:RON) to make it more competitive in Canada. That didn’t materialize, with Home Depot’s 202 Canadian stores taking the lion’s share of the Canadian market. 

The 35 analysts that cover HD stock give it an average rating of “overweight“ with a $346.30 target price.

Target (TGT)

Target (NYSE:TGT) stock is down more than 27% YTD. While Walmart is kicking butt in 2022, Target’s been taken to the woodshed. 

On Nov. 15, Walmart raised its outlook for 2022, reporting 8.2% same-store sales growth, excluding fuel. At the same time, Target cut its forecast after same-store sales only increased by 2.7% in its Q3 2022 report. 

The reason for the difference in same-store sales growth: Walmart generates 56% of its revenue from groceries, while Target’s grocery business accounts for approximately 20%. Inflation has people shopping at Walmart that generally wouldn’t. 

However, as CEO Brian Cornell said in its Q3 2022 conference call, the company is changing its business to deal with a more price-sensitive consumer. Cornell believes that Target can save between $2 billion and $3 billion over the next three years from its changes. 

While the consumer might focus more on grocery items now, Target continues to remodel its stores to improve the customer experience. By the end of 2022, it will have completed about 200 full remodels and opened 23 new locations, including opening a larger 150,000-square-foot prototype in Houston. 

“At nearly 150,000 square feet, this new format incorporates our latest thinking in store design, featuring a more open layout, localized elements to inspire and serve our guests, 5x more space to support our digital fulfillment services and sustainable features in support of our Target-forward goals,” stated COO John Mulligan.

Investors should expect Target to add more of these larger locations. Once inflation subsides or levels off, these stores should add to their bottom line. All of this puts it squarely on my list of retail stocks to buy for 2023 growth. 

On the date of publication, Will Ashworth did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.