It's been an incredible year for investors in the stock market. The S&P 500 index is up nearly 25% year to date as of this writing, hitting a fresh 52-week high with just a couple of trading days left in 2023.

But while many individual stocks have fared even better, others have pulled back significantly from their highs earlier this year. I think these two growth stocks, in particular, are worth buying on the recent dip.

Grab this AI stock while you can

Shares of C3.ai (AI 3.02%) are up more than 160% in 2023. But the artificial intelligence (AI) software platform provider is also down more than 40% from its 52-week high in June after enthusiasm surrounding AI stocks began to cool earlier this year.

Some investors like to point to C3.ai's modest revenue growth (at 17% year over year last quarter) as evidence it doesn't deserve its premium valuation. Indeed, C3.ai isn't exactly cheap with shares trading at 11.6x trailing-12-month sales. But I think bearish traders are missing two key catalysts.

First, recall that C3.ai transitioned to a consumption-based pricing model (rather than a subscription-based model) almost exactly one year ago. The move significantly bolstered the platform's value proposition to customers, but also created a massive near-term headwind to C3.ai's reported revenue growth. Now that C3.ai is beginning to lap that transition, however, it's beginning to see revenue growth accelerate once again.

Second, during the company's latest quarterly earnings call earlier this month, CFO Juho Parkkinen confirmed it remains on track to achieve positive cash flow starting in the fourth quarter of fiscal year 2024 (ending April 30, 2024). Parkkinen added that C3.ai should be able to follow not long after with its first non-GAAP (adjusted) net profit in the second half of fiscal 2025.

As C3.ai not only delivers accelerated revenue growth, but also continues its march toward sustained positive cash flows and net profitability, its stock price should have little trouble eventually revisiting those previous highs.

A beaten-down growth stock ready for 2024

Shares of Redfin (RDFN 8.49%) have rallied 130% in 2023, including more than doubling since the end of October. But similar to C3.ai, the online real estate platform remains more than 40% below its 52-week high set in July, and is down nearly 90% from its post-pandemic highs. So I don't mind going out on a limb to say this still counts as a "dip."

Why by Redfin now? Consider U.S. Federal Reserve officials' recent indication that the central bank will cut the federal funds rate at least three times in 2024. The news is already serving as a tailwind for the previously depressed real estate market on which Redfin relies.

Indeed, Redfin revealed last week that only 15.5% of home listings in the U.S. qualified as "affordable" in 2023 as measured by household incomes. That marked the metric's lowest level on record due to a combination of high mortgage interest rates and fewer listings.

But rates have already begun to fall, specifically to below 7% earlier this month for the first time since July. This, in turn, has sparked a 9% year-over-year increase in new listings, Redfin says, marking the metric's largest gain in over two years. Those new listings should translate to more buyers in 2024, which should mean a significant improvement to Redfin's top and bottom lines.

Though Redfin has already begun to rally from its lows as astute investors can read the writing on the wall, I see no reason the stock can't continue to deliver outsize returns for the foreseeable future.