2 Super Growth Stocks Down 44% and 58% to Buy Now and Hold Forever

Legendary investor Shelby Davis once said, “You make most of your money in a bear market, you just don’t realize it at the time.” That insight is particularly valuable in the current situation. Economic uncertainty has dragged the S&P 500 and Nasdaq Composite into a bear market, and variables like rising interest rates and geopolitical conflict could certainly make things worse in the near term.

However, while traders are worried about things beyond their control, patient investors have the chance to buy great stocks at a discount, and that could translate into big gains down the road. For instance, CrowdStrike Holdings (CRWD -0.66%) and MercadoLibre (MELI 5.37%) have seen their share prices drop 44% and 58%, respectively, from all-time highs. But the future still looks bright for both companies.

Here’s what investors should know about these two super growth stocks.

1. CrowdStrike: The leader in endpoint protection and managed security

CrowdStrike is the gold standard in several cybersecurity end markets. Its platform includes 22 software products, spanning from endpoint and cloud security to identity protection and managed security services. Most recently, CrowdStrike added LogScale, a product that provides real-time visibility into the performance of applications and infrastructure, to its portfolio.

The broad scope of its platform is a key advantage. It distinguishes CrowdStrike from most vendors, and it allows customers to consolidate security spend on a single platform. Better yet, all 22 software products are delivered through a single lightweight agent that can be installed without a device reboot. That unique quality reduces friction for customers and further differentiates CrowdStrike from the competition.

Those advantages allowed the company to achieve a leadership position in corporate endpoint security, managed detection and response, and threat intelligence.

That scale affords CrowdStrike yet another advantage, allowing it to capture more data than its peers. That makes its artificial intelligence models uniquely effective in detecting even the most sophisticated cyberattacks, according to management.

CrowdStrike increased its customer count 51% over the past year, and the average customer increased spend by more than 20%. In turn, revenue climbed 61% to $1.8 billion and free cash flow soared 49% to $543 million. But investors have good reason to believe CrowdStrike can maintain that momentum. Management puts its addressable market at $97 billion by 2025, and the company has already demonstrated its capacity for innovation on countless occasions. That should keep CrowdStrike on the cutting edge of cybersecurity for years to come.

Currently, shares trade at 20.7 times sales, a discount compared to the three-year average of 36.5 times sales. That’s why this growth stock is worth buying.

2. MercadoLibre: The leading online marketplace in Latin America

MercadoLibre is the leading e-commerce marketplace in Latin America, both in terms of total sales and monthly visitors. That success stems in part from its first-mover status, but the company cemented its leadership by providing adjacent services to merchants and consumers. For instance, Mercado Pago processes payments and provides digital wallets, Mercado Credit originates loans and issues credit cards, and Mercado Envios provides logistics solutions.

More importantly, those adjacent services are resonating with buyers and sellers. In the second quarter, Mercado Pago digital wallet users jumped 42% to 21.4 million, and total payment volume soared 72% to $30.2 billion. Meanwhile, Mercado Credito increased its credit portfolio over 230% to $2.7 billion, driven by especially strong growth in consumer loans and credit cards. Finally, Mercado Envios handled 91% of shipping volume, meaning merchants rely heavily on the company’s logistics solutions.

Not surprisingly, MercadoLibre delivered impressive financial results over the past year, in spite of macroeconomic headwinds. Revenue climbed 60% to $8.8 billion, fueled by particularly strong growth in the fintech segment, and the company posted positive GAAP earnings of $4.73 per diluted share, up from a loss of $0.05 per diluted share in the prior year.

Looking ahead, MercadoLibre sits in front of a large and growing addressable market. Its gross merchandise volume totaled $28.4 billion last year, but e-commerce sales in Latin America will total $259 billion in 2025, according to Statista. And its total payment volume hit $77.4 billion last year, but digital payment volume in Latin America is expected to reach $510 billion by 2027.

With that in mind, shares currently trade at 4.7 times sales — a discount compared to the three-year average of 13.4 times sales — and that creates a great buying opportunity for patient investors.

Trevor Jennewine has positions in CrowdStrike Holdings, Inc. and MercadoLibre. The Motley Fool has positions in and recommends CrowdStrike Holdings, Inc. and MercadoLibre. The Motley Fool has a disclosure policy.

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