Market Sell-Off: 2 Monster Growth Stocks to Buy at a Discount

A steady flow of negative news in recent weeks has disrupted the stock market's latest bullish run. The U.S. debt ceiling debate and concerns about China created volatility that has sent the S&P 500 index down as much as 5% from record highs set just over a month ago.

But volatility and healthy corrections are nothing new for the stock market. In fact, most years we typically see at least a 5% down move at some point. What's important is not to panic, and remember that no negative event has ever permanently derailed the U.S. markets. 

History actually suggests that market sell-offs are an ideal time to look for opportunities to buy your favorite stocks. Here are two high-growth examples to consider adding to your shopping list.

Image source: Getty Images.

1. The case for Facebook

While a falling broader market tends to adversely impact many individual companies, Facebook (META -10.56%) is contending with larger issues than a market downturn. A whistleblower has revealed some unsettling practices within the company as it relates to the treatment of harmful content, adding potential pressure for Facebook to sacrifice some profit to make its various platforms safer for users, especially children. 

To make matters worse, it's coming off a six-hour global outage across all Facebook-owned platforms earlier this week. The outage likely cost Facebook a sizable chunk of revenue, not to mention eroded trust in its reputation for maintaining uptime. 

The combination of headwinds has sent the stock price tumbling by 14% over the past month, but for patient investors, it might be an opportunity to pick shares up at a discount for the long term. 

Data Source: Facebook, Yahoo! Finance. CAGR = Compound annual growth rate.

While Facebook's top- and bottom-line growth rates have been impressive over the last five years, the best might still be coming. The company is set to take a leadership position in the next generation of social technology known as the metaverse, where users will be present inside virtual experiences rather than observing them externally. It could even feature its own digital economy, and facilitating that ecosystem is an enormous financial opportunity for Facebook. 

But the company's present challenges can't be ignored. It has grappled with questions about platform safety and the public good before -- it's an essential subject for a social network with 2.9 billion monthly users -- but investors should pay attention to how it resolves them this time, as the pressure has arguably never been higher. 

The stock's forward price-to-earnings multiple of 23 times is 32% lower than where the broader Nasdaq 100 index trades, which Facebook is a member of. That's an attractive proposition for investors with a long-term focus, especially when it comes to exciting new frontiers like the metaverse. Enduring the short-term noise might deliver big rewards in the future.

Image source: Getty Images.

2. The case for Nvidia

Advanced computer chips, or semiconductors as they're referred to in the industry, have become the single most important component in modern consumer electronics. Nvidia (NVDA 3.71%) is a world-class producer best known for its popular graphics cards, and it's playing a central role in the future of technologies like artificial intelligence.

Nvidia's stock price has risen by more than 1,080% in the last five years, and its operational performance suggests it's perfectly warranted. 

Data Source: Nvidia, Yahoo! Finance. CAGR = Compound Annual Growth Rate.

The company's revenue growth is red-hot, and it's driven by a diversified group of segments led by gaming. Nvidia sold $3.06 billion worth of gaming-related graphics products in the most recent fiscal second quarter alone; an 85% boost over the same period last year. But its most exciting segments are its smaller ones, which focus on experimental technologies like virtual reality and automotive self-driving applications.

Like Facebook, Nvidia has a keen interest in the metaverse. Its Omniverse platform is delivering the foundations of this new social technology, and it's partnering with a plethora of other technology companies in a collaborative effort to bring the concept to life. 

But despite all of these exciting ventures, Nvidia isn't immune to the recent market downturn. Its stock price has fallen by 13% over the past month, which offers investors an opportunity to buy a slice of the future at a discount. 

The company is expected to generate $4.14 in earnings per share by the end of fiscal 2022, and that places the stock at a forward multiple of 47 times. While it's not as cheap as Facebook, it might prove to be when we look back five years from now.