I prefer to buy a top FTSE 100 growth stock when the market is falling rather than when it is rising. That reduces the chances of getting swept up in a brief burst of positive sentiment and overpaying.

So when the index recently shot past 8,000 for the first time, I called a halt to my shopping spree. While timing the stock market is impossible, I suspected investors had become a bit too excited, and a pullback was inevitable.

This stock is getting cheaper

That pullback appears to be here, with the FTSE 100 down more than 3% from its recent high, trading at around 7,750, at time of writing. Hargreaves Lansdown (LSE: HL) stock has fallen a lot more than that over the last year, and I’m finally ready to buy it.

I have decided against buying the online investment platform for years. I took fright when I saw it was trading at something like 27 times earnings and yielding just 1.6% or so. I prefer to buy cheap stocks with high (but sustainable) yields, rather than the other way around.

Cheaper rival platforms appeared to be playing catch up while I felt stock markets generally had flown too high. I’m a long-standing Hargreaves Lansdown customer, and rate its customer service, but felt it had been overbought.

It appears that I was right, as its share price has plunged 21.17% over the last year, and 51.26% over five years.

Hargreaves Lansdown is now a lot cheaper than it was, trading at just 16.7 times earnings. The forecast yield is much higher at 4.95%, comfortably above the FTSE 100 average of around 4%. Dividend cover is a little thin at 1.3, but management has a tidy record of increasing shareholder payouts. Over the last five years it has steadily lifted them from 32.20p per share to 39.70p per share.

Inevitably, its fortunes are closely tied to the stock market and last year was tough. Yet last month it reported strong half-year growth, despite “challenging” market conditions.

Hargreaves now looks like a buy

Revenues smashed expectations, climbing 20% to £350m, with profit before tax up 31% to £197.6m. Despite that promising news, the stock has fallen 8% since then. I think that makes now a good time to buy.

The Hargreaves Lansdown share price fell around 5% on Friday, as US investors panicked over that country’s banking stocks. That had nothing to do with Hargreaves Lansdown directly, but had an obvious knock-on effect, given its exposure to financial services and the stock market generally.

Obviously, there are risks. If central bankers continue to hike interest rates, investor sentiment will retreat further. That will hit the group’s assets under administration, reducing its fee income. The latest banking crisis could cast a shadow over financial stocks like this one, and I’m keeping a close on Hargreaves Lansdown, to see how it fares.

For a long-term investor like me, who aims to hold stocks for years if not decades, a short-term drop in its share price in the days ahead could be an unmissable buying opportunity. Let’s see how it goes.

The post This dividend growth stock looks like an unmissable buy as market volatility returns appeared first on The Motley Fool UK.

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Harvey Jones has no position in any of the shares mentioned. The Motley Fool UK has recommended Hargreaves Lansdown Plc. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.