The Nasdaq 100 (^NDX) is packed with high-growth companies, and while the market is competitive, some are pulling ahead. A handful of standout businesses are continuing to scale, delivering strong financials and market leadership.
Finding the best companies in the Nasdaq 100 isn’t always obvious, and that’s why we started StockStory. Keeping that in mind, here are three Nasdaq 100 stocks that have huge potential.
Market Cap: $278.6 billion
Founded in 1967 as the first company to develop tools for other businesses in the semiconductor industry, Applied Materials (NASDAQ:AMAT) is the largest provider of semiconductor wafer fabrication equipment.
Why Are We Fans of AMAT?
Highly efficient business model is illustrated by its impressive 28.7% operating margin
AMAT is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
Stellar returns on capital showcase management’s ability to surface highly profitable business ventures
At $346.50 per share, Applied Materials trades at 28.7x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Market Cap: $86.47 billion
One of two remaining major hard drive manufacturers after decades of industry consolidation, Seagate (NASDAQ:STX) manufactures hard disk drives and solid state drives that store data in data centers, cloud systems, and consumer devices.
Why Do We Like STX?
Annual revenue growth of 24.7% over the last two years was superb and indicates its market share increased during this cycle
Demand will likely accelerate over the next 12 months as its forecasted revenue growth of 28.2% is above its two-year trend
Operating margin increased by 8 percentage points over the last five years as it refined its cost structure
Seagate’s stock price of $382.00 implies a valuation ratio of 23x forward P/E. Is now the time to initiate a position? See for yourself in our full research report, it’s free.
Market Cap: $3.73 trillion
Started by Stanford students Larry Page and Sergey Brin in a Menlo Park garage, Alphabet (NASDAQ:GOOGL) is the parent company of the eponymous Google Search engine, Google Cloud Platform, and YouTube.
Why Will GOOGL Beat the Market?
Alphabet’s dominant Google Search sits on the pantheon of the best businesses ever. This is reflected in its robust long-term revenue growth and elite operating margin.
The company’s profit margins have become even higher over time, speaking to its scale advantages and operating efficiency not only in its core Search business but also in Google Cloud Platform and YouTube.
Revenue growth and increasing operating margins are the key ingredients for strong EPS growth. Google has these, and when also factoring in its share repurchases, you can see why EPS has exploded over the long term.
