The stock market fell sharply on Wednesday after Fitch Ratings lowered the U.S. government's credit rating, the first downgrade from a major firm in more than a decade. The benchmark S&P 500 fell 1.4% in its worst showing since April, and the tech-heavy Nasdaq Composite tumbled 2.2% in its worst day since February.

Fitch attributed its decision to "repeated debt-limit political standoffs and last-minute resolutions" that have eroded confidence in fiscal management. But JPMorgan Chase CEO Jamie Dimon called the decision ridiculous, noting that the U.S. is "still the most prosperous nation on the planet." He also said the downgrade mattered very little because the market (not rating agencies) determines borrowing costs.

Unfortunately, Paycom Software (PAYC 1.24%) and SolarEdge Technologies (SEDG 2.81%) were caught in the riptide of the downgrade. The companies reported earnings after the market closed on Tuesday, and both provided worse-than-expected guidance for the current quarter. Management's downbeat outlook combined with broader credit rating anxiety caused shares of Paycom and SolarEdge to plummet 19.2% and 18.4%, respectively, on Wednesday.

Here's why both stocks are worth buying.

1. Paycom Software

Paycom offers human capital management (HCM) software for the entire employee life cycle. Its platform includes tools for hiring, training, scheduling, and payroll, as well as other human resources tasks like compliance reporting and benefits administration. That comprehensive approach to HCM gives Paycom an edge, because many organizations still rely on multiple vendors to meet their HCM needs, a strategy that often creates extra work for IT and HR teams.

Paycom has also differentiated itself through product innovation. It became one of the first vendors to offer web-based HCM software in 1998, and it debuted the first self-service payroll software in 2021. The product (nicknamed Beti) automates payroll by requiring employees to review and approve their paychecks prior to finalization, reducing associated labor costs by up to 90%.

Paycom reported solid financial results in the second quarter as the labor market remained resilient despite rapid interest rate hikes from the Federal Reserve. Revenue rose 27% to $401 million and non-GAAP earnings climbed 29% to $1.62 per diluted share. Yet the stock still nosedived following the report because current-quarter revenue guidance missed expectations. That tells me some investors have lost sight of the big picture.

In the past, Paycom confined its operations to the U.S., but the company is now expanding internationally. Its recently launched Global HCM product makes its software accessible in more than 180 countries, which significantly increases its addressable market. Indeed, CEO Chad Richison says the company holds far less than 5% market share, leaving Paycom with plenty of room to grow in the future.

Currently, shares trade for 11.8 times sales, a discount to the three-year average of 20.3 times sales. Investors should feel comfortable buying a small position in this growth stock.

2. SolarEdge Technologies

SolarEdge is the largest manufacturer of solar inverters, which are devices that convert the direct current electricity produced by solar panels (or modules) into alternating current electricity used by homes and businesses. The company also provides adjacent solar products for residential and commercial customers, including electric vehicle chargers, battery storage, and monitoring software. But SolarEdge is best known for inventing power optimizers, devices that adjust current and voltage in real-time to improve solar module performance.

Here's why that matters: Solar systems that use traditional string inverters are limited by the least performant panel, so energy production can suffer with asymmetrical rooftops, module mismatch, and partial shade. Power optimizers eliminate those losses by maximizing the energy production of each panel independently. Microinverters from Enphase Energy accomplish the same thing, but they are the most expensive of the three options.

SolarEdge reported phenomenal financial results in the second quarter. Revenue climbed 36% year over year to $991 million and non-GAAP net income soared 177% to $157 million. But third-quarter revenue guidance fell short of Wall Street's expectations, with management warning of weak demand arising from high interest rates and excess inventory that could take several quarters to resolve. But investors should shake it off. Temporary headwinds will not stop the inevitable adoption of solar power.

Indeed, Grand View Research expects the solar energy systems market to grow by 15.7% annually to reach $608 billion by 2030. SolarEdge is well positioned to benefit given its leadership in inverters, but the company has expanded its addressable market by branching into adjacent areas like residential and commercial storage solutions.

Currently, shares trade for 3.4 times sales, a discount to the three-year average of 7.7 times sales. That's why this renewable energy stock is worth buying.