The S&P500 fell 22% from its all-time high, putting the benchmark in a bear market. Losses of this magnitude can leave even experienced investors feeling shaken, but the worst mistake you can make is allowing yourself to be scared of high-quality stocks. The length and severity of a bear market vary, but each past downturn has eventually been overtaken by a new bull market.

Building on this idea, actions like Nvidia (NVDA 5.55%) and Axon Enterprise (AXONE 5.64%) are down more than 50%, but the underlying businesses remain healthy and the long-term investment theses are still largely intact. This creates a buying opportunity for patient investors.

Here’s what you need to know.

1.Nvidia

Nvidia technology has become the gold standard in several rapidly growing end markets, including graphics, scientific computing, and artificial intelligence (AI). In fact, the company has over 90% market share in graphics and supercomputer accelerators for workstations, and Nvidia AI has consistently set performance records at MLPerf benchmarks over the past three years.

Nvidia’s main innovation is the graphics processing unit (GPU), a chip designed for compute-intensive tasks. This means that GPUs excel at rendering realistic graphics, accelerating machine learning applications, and making sense of huge amounts of data. But Nvidia has become more than just a chipmaker, bolstering its portfolio with subscription software for 3D design, data analysis and AI development. The company has also added high-performance networking solutions to its catalog to strengthen its value proposition in the data center.

Collectively, its cutting-edge technology and brand authority have made Nvidia a financial machine. Despite supply chain issues and high inflation, revenue soared 53% to $29.5 billion in the past year, and free cash flow soared 44% to $7.5 billion. More importantly, the company is poised to maintain this momentum for years to come.

Nvidia has woven itself into the fabric of everyday life. Every film nominated for the Best Visual Effects Oscar in the past 14 years has been rendered with Nvidia technology. Retailers love Amazon, Krogerand PepsiCo use Nvidia products to create digital twins that improve store layouts, optimize supply chains and train autonomous robots. And social media companies like Instantaneous and pinterest use Nvidia hardware and software to make recommendations more relevant.

Looking ahead, management puts its market opportunity at $1 trillion, and Nvidia stands to benefit from the continued evolution of trends such as virtual reality and the metaverse, autonomous robots and self-driving cars, as well as the integrating AI into more aspects of daily life.

Currently, the shares are trading at 14.4 times sales, a bargain compared to Nvidia’s average valuation of 20 times sales over the past three years. That’s why this growth stock is worth buying today.

2. Axone Company

Axon specializes in public safety. For many years, its main product was a conducted energy device (CED) sold under the Taser brand. In fact, Axon still ranks as the leading supplier of CED, but it has also expanded into software and sensors. In this ecosystem, Axon sensors such as body cameras and dash cams stream video data to Axon Cloud, a suite of software for digital evidence management, reporting and real-time situational awareness.

Overall, Axon makes customers such as law enforcement and federal agencies more transparent and efficient by digitizing paper-based processes. Studies have also shown that body cameras reduce the time officers spend in court by increasing guilty pleas and providing objective evidence. Axon’s software also incorporates artificial intelligence to automate video editing and speed up report writing, and the company believes its AI will eventually eliminate paperwork altogether.

Financially, Axon is growing at a steady pace. Revenue soared 27% to $925 million in the past year, fueled by particularly strong momentum in its software and sensors business. In the end, the company generated $51 million in free cash flow, ten times more than the previous year’s $4.8 million.

Looking ahead, shareholders have good reason to be optimistic. Axon estimates its market opportunity at $52 billion, and the company’s success in the CED market has allowed it to establish a customer relationship with nearly 95% of US law enforcement agencies. This competitive advantage should boost its software and sensor business in the years to come.

More broadly, Axon is also striving to grow in the commercial sector, as its products can be used for retail loss prevention, compliance investigations and on-site security. On this front, management noted encouraging momentum over the past quarter.

Currently, Axon shares are trading at 6.5 times sales, significantly cheaper than the three-year average of 10.6 times sales. That’s why this growth stock looks like a bargain right now.