3 Growth Stocks Worth Buying Through the Chaos and Holding for the Long Term

It's been a wild past few months for the market. Indeed, after falling 8% in March alone, the S&P 500 has since rallied more than 12% from that low. While stocks are now teasing the prospect of another big pullback, nobody really knows what's coming next.

This sort of volatility, of course, is the very chaos that long-term investors are supposed to be ignoring. The so-called "smart money" remains focused on individual companies' fundamentals and the bigger economic backdrop.

Here's a closer look at three growth names investors might want to consider stepping into in the midst of all the chaos while you can get into all of them at an attractive price.

Carvana

If you keep regular tabs on Carvana (NYSE: CVNA), then you probably know the used car dealer's stock stumbled in February following a disappointing earnings report.

Although the company's fiscal fourth-quarter revenue grew 58% year over year to a record-breaking $5.6 billion versus analyst estimates of less than $5.3 billion, unexpectedly high expenses meant Carvana's earnings before interest, taxes, depreciation, and amortization (EBITDA) of $511 million fell short of the projected $535.7 million. And, for the second quarter in a row, gross profit per retail unit also fell year over year, confirming the online used car dealership's costs and pricing power are under some pressure.

Already reeling from short-seller Gotham City Research's late-January accusations that the company overstated earnings, Carvana shares cratered in response to its Q4 report. Curiously, though, less than a month later, this stock was rallying again.

Some of this bullishness can be chalked up to the marketwide rebound that would take shape shortly thereafter.

But most of the gain since mid-March is arguably attributable to the realization that Carvana's top line still grew 58% year over year in the fourth quarter, and the company's still quite profitable, with Q4's operating income of $424 million measurably improving on the year-ago comparison of $260 million. Total retail unit sales also grew 43% during the fourth quarter, to 163,522 automobiles, extending a long-established streak.

Sure, investors would much rather see never-ending progress for all of a company's fiscal metrics. But that's an unrealistic expectation. Carvana is doing well by most measures, and the ones where it isn't -- costs -- are largely beyond its control.

Besides, the company still has a massive opportunity ahead to reclaim some of its waning pricing power. As big as it already is, it still only controls 1.6% of the nation's highly fragmented used car market, which is just waiting for some consolidation under a leading name like Carvana.

Block

It's been a tough past few years for shareholders of payment middleman Block (NYSE: XYZ), formerly known as Square. Although up since February's low, the fintech stock's really gone nowhere since peeling back from its pandemic-prompted 2021 peak.

But when you take a step back and look at the bigger picture here (and specifically, the company's results over the past few years), the stock's stagnation doesn't make a whole lot of sense. While it's not producing a massive amount of revenue or earnings growth, it's consistently producing some of both.

XYZ Revenue (TTM) data by YCharts

Investors appear to be waiting on a headwind that just isn't materializing. If it hasn't yet, however, it isn't apt to do so now.

This might help. While most investors might be deterred, most analysts aren't. The vast majority of the analyst crowd covering Block currently rate it as a strong buy, with a 12-month consensus price target of $87.27. That's 25% above the ticker's present price, which isn't a bad way to start out a new trade. The stock just needs a nudge.

WM

Last but not least, add WM (NYSE: WM) -- you may know it better as trash-disposal name Waste Management -- to your list of long-term growth stocks to buy and hold through the market's short-term ebbs and flows.

The reasoning isn't too tough to figure out. As long as people exist, they'll be throwing garbage away. America produces nearly 300 million tons of it every year, in fact. That's roughly five pounds per person per day. And despite efforts to encourage recycling and consume more thoughtfully, the numbers aren't getting better. If anything, they're still getting worse, so much so that the nation is literally running out of places to establish or expand landfills.

Environmental concerns aside, this dynamic leaves WM in an enviable position. With more than 260 landfills, over 500 waste transfer facilities, and more than 100 recycling sites, the company is ready to offer what the country will increasingly be willing to pay a premium for... whether or not it realizes it yet.

Investors are already reaping the benefit of this lurking undertow, too. Factoring in reinvested dividends during this stretch, over the past 10 years, WM has outperformed the S&P 500. The weakness since last year is arguably temporary, reflecting the company's spending linked to its entry into the medical waste business and other investments in an environment where most things are more expensive than they were just a year earlier.

Sexy? Not even a little bit. You don't invest for entertainment, though. You invest in growth stocks for maximum potential for returns with the highest odds of success at the lowest possible risk. That's what this often-overlooked ticker brings to the table. Its 23 consecutive years of per-share dividend growth and consistent stock buybacks are just a nice bonus.

James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Block. The Motley Fool recommends WM. The Motley Fool has a disclosure policy.