The Nasdaq-100 technology index has spent much of 2022 in bear market territory. High inflation and rising interest rates have thrown cold water over investors' growth expectations for some of the best-performing tech companies, meaning they're willing to pay much less for those stocks now compared to a year ago. 

Still, the broader market has staged a convincing bounce over the past two months. But after the Federal Reserve came out last week and warned investors that it wasn't done with aggressively hiking interest rates, the decline appears to have resumed. 

History suggests that a down market is the best time to put money to work because, given enough time, prices eventually tend to recover to new highs. But not all stocks are created equal and in an environment like this, it's crucial to be selective. Here's one stock to buy now and one to sell.

The stock to buy: Sea Limited

Sea Limited (SE 0.92%) stock has been hammered over the last 12 months, losing 82% of its value since reaching its all-time high price of $372.70. The company's challenges are likely to persist in the short term, but this might be a golden opportunity for investors with a five-to-10-year time horizon. 

Sea Limited operates in three key areas of the digital economy: e-commerce, digital entertainment (gaming), and payments. The digital entertainment segment accounts for about a third of the company's total revenue, and it generated soaring growth during 2020 and 2021 thanks to pandemic lockdowns, which led to people spending more time in front of their screens. 

But society has gradually reopened, and Sea Limited's gaming segment is now shrinking -- to the tune of 10% (year over year) in the recent second quarter of 2022. The company's game studio still holds one of the highest-grossing mobile titles, called Free Fire, which was also the most downloaded game globally in the second quarter. But the industry as a whole is likely to continue experiencing a decrease in engagement compared to the last two years. 

There is some good news for Sea Limited, though. The strength in the e-commerce industry has continued beyond the worst of the pandemic, which is a big win for the company as it accounts for over half of its revenue. Sea Limited saw e-commerce growth of 51% year over year in Q2 to $1.7 billion in revenue. In the shopping category, its Shopee app remains No. 1 in Southeast Asia -- the company's focus market -- in both active users and time spent on the platform. 

Sea Limited faces the challenge of turning profitable now after years of investing in growth. It has lost $2.7 billion over the last four quarters on $11.7 billion in total revenue, but it does have $7.7 billion in cash, equivalents, and short-term investments on its balance sheet, so it has plenty of room to make the necessary adjustments. Investors should remain focused on the long run because between now and 2027, the global e-commerce opportunity is set to nearly double to $27.1 trillion annually, according to Grand View Research. 

The stock to sell: DoorDash

Who doesn't love food delivery? It has become a part of life for many people, much like ride-sharing and social media, and DoorDash (DASH -0.20%) holds a 59% market share in the industry in the U.S. But this is one of the rare cases where being the biggest hasn't yielded a great deal of fruit for investors, because DoorDash stock is trading near its 52-week low and the price has declined 75% from its all-time high.

Based on DoorDash's last few quarters of financial data, it's becoming evident that peak growth occurred during 2021 for the company. Since then, its revenue has rapidly decelerated and, unlike Sea Limited which operates in multiple fast-growing segments, DoorDash's market opportunity might be limited from here.

Why? Recent surveys of American consumers suggest 45% of households are dependent on food delivery already, but while it's so easy and convenient, cost is likely a prohibitive factor in growing that base much further. According to research by Loup Funds, it's 58% more expensive to use DoorDash than to pick up (or dine-in) the same meal directly from the restaurant. Not to mention, there's very little customer loyalty across delivery platforms, with up to 62% of Americans using multiple providers -- and 20% using four or more. 

In the second quarter of 2022 (ended June 30), DoorDash grew its revenue by 30% to $1.6 billion. That isn't a terrible growth rate by any means, but it's down significantly from the 83% growth it delivered in the same period last year. Plus, its second-quarter loss of $263 million was the steepest since the fourth quarter of 2020, and it's a result of a whopping 41% year-over-year jump in costs. 

DoorDash now finds itself slightly trimming back on expenses like marketing, but it operates in a highly competitive industry and its service isn't very different than other providers, so this could result in its market share (and its sales) slipping over time. 

Put simply, DoorDash is a slowing business with a potentially limited market opportunity, and its path to profitability is rather murky. That's probably not the best place for investors' money right now.