Nasdaq Correction: 2 Outstanding Growth Stocks to Buy on the Dip

The tech-heavy Nasdaq Composite recently entered correction territory, as defined as a 10% drop from its most recent high. That means it is halfway to bear-market levels. Many investors are staying away from equities right now, given the challenging broader macroeconomic conditions that are partly to blame for the Nasdaq's decline. However, it might actually be a great time to scoop up shares of attractive companies on the dip. Here are two excellent growth stocks to consider right now: MercadoLibre (NASDAQ: MELI) and Shopify (NASDAQ: SHOP).

1. MercadoLibre

In fairness, MercadoLibre's shares started declining long before the recent volatility. Investors who feel as though the company's future is bleak -- given increased competition in its core market in Latin America -- do have a point. Even so, MercadoLibre is positioning itself to be a major winner as the e-commerce market expands over the long run, including in its home region.

The company is combating growing competition with initiatives that might harm margins in the short run but should boost revenue and engagement over time. These include expanded free shipping. Lowering the amount consumers need to spend before having access to this perk has worked wonders for MercadoLibre in the past. It can do so again.

Meanwhile, MercadoLibre is tapping into a vast banking opportunity in Latin America. The company argues that far too many people lack access to a range of banking services in countries such as Mexico and Argentina. Expanding credit (and other) offerings may, once again, negatively impact its financial results in the short run. Even so, it will grow its ecosystem and unlock meaningful revenue opportunities in the future.

Amid all that, MercadoLibre benefits from a strong moat, driven by network effects and switching costs. The company may be struggling on equity markets right now, but its long-term outlook remains intact.

2. Shopify

Shopify is another leading e-commerce platform that helps merchants start online storefronts and provides everything else they need to run their businesses smoothly. Shopify's financial results remain strong; it is finally turning profitable -- the bottom line is positive over the trailing-12-month period -- and it even grew its market share in its corner of the e-commerce space in the U.S. over the past few years. However, some investors worry about valuation. Shopify is trading at 82.6x forward earnings. That's quite high, even for a company with Shopify's growth prospects.

That said, how meaningful is Shopify's price-to-earnings ratio considering it hasn't been profitable for that long? Also, how much will it matter in a decade or so? My view is that valuation shouldn't stop investors focused on the long game from scooping up the company's shares. Backed by a highly versatile platform that can cater to the needs of most small and mid-sized businesses, and a large library of services which includes an app store with over 16,000 options, Shopify is well-positioned to ride the e-commerce wave over the long run, especially once we factor in the company's moat from switching costs. Down 24% this year, the company's shares remain attractive.

Prosper Junior Bakiny has positions in MercadoLibre and Shopify. The Motley Fool has positions in and recommends MercadoLibre and Shopify. The Motley Fool has a disclosure policy.