While the stock market experienced chaos in 2022, it appears to be recovering this year. Markets endure periods of volatility, and that presents opportunities for aggressive growth-investors to buy good stocks at low prices. Buying and holding high-growth stocks over time is a sound investment strategy.

Two stocks that fascinate me are vacation rental leader Airbnb (ABNB 2.08%) and visual-based tech company Pinterest (NYSE:PINS). Both companies have distinct business models that distinguish them from rivals in their respective industries. Here's what you need to know about the long-term upside for these two growth stocks.

A person with luggage standing outside a house

Image source: Getty Images.

1. Airbnb

Vacation rental leader Airbnb may have underperformed the market in the last three years, but it has tremendous long-term prospects. The pandemic had a significant impact on Airbnb's business, as travel demand ceased. However, as the travel industry rebounds, Airbnb is demonstrating the strength of its business model.

It is an online platform that connects travelers with hosts who want to rent out their homes or other properties as vacation rentals. Airbnb's unique model gives it an advantage over traditional hotel operators.

It allows travelers to rent even in unusual locations where most hotels do not operate. Airbnb properties also provide more personalized experiences. This has served as a moat for the company, allowing it to increase its revenue and profit margins over the past year.

Investors expected rising inflation to reduce consumer travel spending. However, Airbnb's strong first-quarter results impressed investors. Revenue in the period increased 20% year over year to $1.8 billion. In addition, the company reported a GAAP (generally accepted accounting principles) profit of $117 million compared with a net loss of $19 million in the year-earlier quarter.

It is rare when a growth company generates significant profits while also maintaining a strong balance sheet. Airbnb is currently operating in 191 countries, and does not purchase properties; it merely serves as an intermediary.

This asset-light model enables it to generate free cash flow that can be used to fund growth plans. In the first quarter, it generated $1.6 billion in free cash flow, a 32% increase year over year. It also had $10.6 billion in cash, cash equivalents, marketable securities, and restricted cash at the end of the quarter.

The travel and tourism industry has outstanding long-term prospects. This year, the industry is expected to be worth $854 billion and surpass $1 trillion by 2027. Airbnb's highly profitable business model allows the company to capitalize on that astounding growth.

2. Pinterest

Pinterest grew in popularity during the pandemic because online platforms were a major source of relief during lockdowns. However, this is not like any other social media company. It is essentially an online platform where users "pin" pictures and web pages that they find interesting to a board. Advertising is how Pinterest makes money. The company has also included a "Buy it" button, which allows users to buy products directly from Pinterest rather than merchant sites.

While investors expected companies that became successful during the pandemic to fail in the post-pandemic market, Pinterest has proven otherwise. Its Q1 revenue increased 5% year over year to $603 million, while global monthly active users (MAU) increased 7% year over year to $463 million.

Despite increasing revenue and active users, the company's Q1 GAAP net loss was $209 million. In the first quarter of 2023, Pinterest increased its revenue and MAU by 122% and 26%, respectively, compared to the same quarter in 2020 -- an impressive increase.

According to management, the company's focus on creating more personalized, timely, and engaging content is what contributes to MAU and mobile app user growth. The company has also begun to include video content on the site, which it believes is favored by visitors.

Pinterest spent over $266 million on research and development in Q1, with sales and marketing accounting for up to $201 million. This shows that it spends heavily to increase user engagement and attract more advertisers. The company had $2.7 billion in cash, cash equivalents, and marketable securities at the end of the quarter.

Pinterest remains a popular and innovative platform that merchants in a wide range of industries can use to attract customers. Management believes that the advertising market is still challenging, but that once the market recovers, the company will have a long way to go.

However, Pinterest is still a risky investment. But if you have the patience to deal with the short-term uncertainty, this social media tech stock with a price-to-sales ratio of less than 7 is a good buy right now.