In the ever-evolving landscape of the stock market, identifying the next big winners can be a challenging endeavor. However, when it comes to building wealth, focusing on industry-leading companies with steady growth is a proven strategy. And sometimes, the market presents us with opportunities to acquire shares of these quality growth stocks at discounted prices, offering patient investors a chance to capitalize on long-term gains. Two such stocks that have caught my attention are Axon Enterprise (NASDAQ: AXON) and Airbnb (NASDAQ: ABNB), both of which are trading below their previous highs despite strong momentum in their respective industries. These companies are poised to benefit from expanding markets and are well-positioned for long-term growth. Let's delve into the details and explore why these stocks could be attractive investments for the next decade.
Axon Enterprise: The Public Safety Leader
Axon Enterprise is a company that is rapidly becoming the go-to operating system for law enforcement and public safety. Its revenue growth has been impressive, with a 35% year-over-year increase in the second quarter, marking its 10th consecutive quarter of 30%+ growth. This consistent performance has driven the stock up nearly 2,000% over the past decade, and the current momentum suggests it could continue to outperform major indexes in the years ahead. One of the key drivers of Axon's success is the 36% year-over-year increase in software and services revenue, indicating a successful shift from hardware sales to higher-margin, recurring software services. The demand for its AI Era Plan, which automates time-consuming tasks like drafting police reports, is strong, and the company is expanding its reach beyond its core market.
International bookings tripled year over year in the last quarter, and future contracted bookings rose by 41% to $15 billion, indicating a promising long-term growth trajectory. Axon is building an end-to-end platform that includes sensors, devices, and AI-powered software, which is reflected in its high forward price-to-earnings multiple of 78. Despite this, analysts project 29% annualized earnings growth, and if the company continues to execute its public safety platform strategy, it could offer market-beating potential over the next decade. The stock is currently trading 30% below its previous all-time high, providing an attractive entry point for investors.
Airbnb: Capitalizing on the Travel Boom
The travel and tourism industry has demonstrated resilience in recent years, with consumers increasingly spending on getaway experiences. Airbnb, with its vast selection of properties, has a competitive edge that traditional hotel chains struggle to match. The stock has surged following strong second-quarter results, but it still trades about 15% below its previous all-time high. In the first half of 2026, Airbnb delivered its strongest growth in years, with revenue rising 17% year over year to $3.6 billion, and gross booking value increasing 16% to $27 billion. The company is attracting more guests, particularly from the Gen Z demographic, with first-time bookers growing by 11% in the last quarter.
Airbnb's expansion into newer markets, which are growing faster than its more mature regions, is also contributing to its growth. The internal use of AI is enabling the company to launch updates more frequently, making it easier for guests to discover and book accommodations. With a strong free cash flow margin of 37%, the stock trades at 23 times trailing free cash flow and 35 times forward earnings, with analysts expecting earnings to grow at a 19% annualized rate. The favorable long-term outlook for travel, as predicted by the World Travel and Tourism Council, further supports Airbnb's prospects. By 2035, the industry is expected to face a worker shortage as demand grows, positioning Airbnb to benefit from this trend. The stock's current valuation and solid momentum make it a promising growth stock to hold for the next decade.
In conclusion, both Axon Enterprise and Airbnb are well-positioned to benefit from expanding markets and have demonstrated strong growth potential. The market's current undervaluation of these stocks presents an opportunity for investors to capitalize on long-term gains. While the stock market can be unpredictable, focusing on industry-leading companies with steady growth and buying quality growth stocks at discounted prices can be a successful strategy for building wealth over time. These two companies, in particular, offer attractive entry points for investors looking to position themselves for the next decade of market growth.
