A bear market occurs when an index, or the market at large, is down 20% from its peak level. With rising interest rates, sky-high inflation, and geopolitical risk factors pushing the Nasdaq Composite down roughly 25% from the high it hit last year, the tech-heavy index is trudging through bear territory right now -- and investors are spooked. 

While there are a number of risk factors shaping market sentiment right now, there are also great companies that have been pushed down to bargain prices, and long-term investors could score big wins by taking smart contrarian stances. Read on to see which stocks a panel of Motley Fool contributors thinks are great buys amid the current bearish backdrop. 

Golden bull and bear statues.

Image source: Getty Images.

This iBuyer is growing and profitable

Jason Hall: In November 2021, Zillow Group shocked the real estate world when it pulled out of the iBuying market. This was a huge reversal for the company, which had spent the prior several years -- and a lot of money and human resources -- making this its primary growth focus. While I think it was the right move for Zillow to focus on its asset-light, higher-margin real estate platforms, I really like the way Opendoor Technologies (OPEN -7.54%) has proven there's still a lot of money to be made for pure-play iBuying companies. 

In the first quarter, investors got their first glimpse of how ibuying can deliver at scale. When Opendoor reported its results on May 5, it reported $5.2 billion in revenue, a massive 590% increase from last year. It also reported gross margin above 10% -- indication that it's buying properties at attractive prices -- and generated a modest $98 million in net income. Maybe most impressively, it generated a whopping $1.5 billion in operating cash flow, reversing last year's first-quarter outflow of $400 million in operating cash. 

Opendoor is still early in the iBuying story, but it's showing that, at scale, this can be a good business. As more sellers look to take advantage of faster, lower-fee transactions and a simpler process of selling, Opendoor is my pick as a big winner from this growth. At more than 70% off its all-time highs, now looks like a great time to buy shares, and old for years to come.

This streaming player can post explosive returns

Keith Noonan: Twilio's (TWLO 1.65%) software allows businesses to launch and customize automated information response systems, and it provides incredibly important services despite not being a household name. If you've hailed a ride through Lyft or booked a stay through Airbnb, you've interacted with its products. The company also provides messaging tools and artificial-intelligence-powered chat bots, making it easy to tailor customer service interactions to the situation and adapt as demands evolve. 

The company has made some big acquisitions to expand into new markets and help its customers access and analyze data from otherwise walled-off sources, and it's also in the early stages of a big push in the customer relationship management (CRM) space. Backing out the contribution from acquisitions over the previous year, Twilio's revenue grew 35% year over year in the first quarter. Existing customers increased their spending on Twilio's services 27% year over year in the period, and overall sales jumped 48%.

Responsive mobile communication and user engagement technologies are central to meeting modern customer needs and standing out from the competition, but that hasn't shielded the company's stock from big sell-offs. With a market capitalization of roughly $21 billion and the currently unprofitable company valued at approximately 5.5 times this year's expected sales, Twilio's valuation profile is at odds with current market tastes.

However, Twilio stock now trades down roughly 76% from the high that it hit last year, and the stock looks attractively valued at current levels. Despite some macroeconomic headwinds on the horizon and the market running from growth stocks at the moment, I think the software specialist will deliver big wins for investors. 

An education technology business with a strong competitive advantage 

Parkev Tatevosian: My top beaten-down growth stock to buy during this bear market is Chegg (CHGG -1.19%). The education technology company has a solid competitive moat and is trading at its lowest valuation in years. What's more, its competitive advantage has allowed it to grow revenue efficiently for several years. 

Indeed, from 2017 to 2021, Chegg's sales expanded from $255 million to $776 million. Chegg is a subscription business that grants access to its platform with millions of pieces of proprietary content. As part of a membership, students can ask up to 20 questions per month answered by Chegg's subject-matter experts. In that way, Chegg's content creation budget has little waste because it is created at the request of members.

An additional benefit of the content is that it attracts new users with little need for marketing. Students grappling with homework assignments may search for help with a concept; if Chegg has the material in its database, it pops up as a search result. A few clicks and a payment later, Chegg has a new member. That low-cost customer acquisition can partly explain why Chegg has boosted operating income from a loss of $23 million in 2017 to a gain of $78 million in 2021.

CHGG Price to Free Cash Flow Chart

CHGG Price to Free Cash Flow data by YCharts

Fortunately for investors, the growth stock sell-off has Chegg trading at a bargain valuation -- with shares down roughly 83% from peak level. At a price-to-free-cash-flow of 17 and a price-to-sales of 3.7, Chegg is as cheap as it's ever been in the last five years. Chegg is a strong business with a defendable moat, growing efficiently and selling at a bargain valuation. For those reasons, it's an excellent growth stock to buy now.