Investors should not worry about high stock valuations, says strategist, as there is potential for growth.

• Raymond James Investment Management's chief market strategist Matt Orton advised CNBC that brief stock market dips should be seized as opportunities.
• According to FactSet data, Nvidia trades at approximately 35 times forward earnings, while the broader Magnificent 7 trades at an average of around 34 times forward earnings.

According to Matt Orton, chief market strategist at Raymond James Investment Management, investors should ignore valuation concerns and concentrate on growth in the current "stockpicker's market."

The "Magnificent 7" megacap tech stocks have driven much of the significant rally over the last 18 months, but they have begun to diverge.

While 10% is down, 34% is lower, 11%, 15%, and 37% are up, respectively. Meanwhile, 77% is higher, and 1% is little changed.

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The focus of commentary around the market rally has been on the high valuations of U.S. stocks. Nvidia trades at around 35 times forward earnings, while the broader Magnificent 7 trades at an average of around 34 times forward earnings. In contrast, the S&P 500 is at a historically high average of 21 times forward earnings.

A company's expected earnings per share are divided by its share price to calculate the forward price-earnings (P/E) ratio. Typically, a high P/E ratio suggests that a stock may be overvalued.

Today's stock market composition is so different that historical comparisons are irrelevant, argued Orton.

My main message to clients is: disregard the optics and past market trends, as the market has become significantly more 'growthier' in various sectors, including tech, industrials, consumer discretionary, and certain parts of healthcare. As a result, growth companies command higher multiples. Therefore, the market should not be trading at 17 times earnings, but rather at 18 or 19 times earnings.

Stocks in emerging industries, such as tech and AI, are predicted to generate higher earnings growth than average, thanks to their innovative products or services that give them a competitive edge (like healthcare companies with popular weight loss drugs).

According to Orton, the market could potentially reach 20 to 21 times, which is a reasonable multiple for us to pay. The focus should be on earnings growth and identifying where those fundamentals are, while avoiding areas of the market with a negative inflection in earnings.

"No matter the valuation, you can grow into it, and the main message for investors is to find growth."