While the Nasdaq 100 (^NDX) is filled with cutting-edge technology and consumer companies, not all are on solid footing. Some are dealing with declining demand, high costs, or regulatory pressures that could limit future upside.
Investing in Nasdaq 100 stocks isn’t just about picking big names - it’s about finding the right ones, and that’s where StockStory comes in. Keeping that in mind, here are two Nasdaq 100 stocks that could lead the market and one that may struggle.
One Stock to Sell:
PepsiCo (PEP)
Market Cap: $181 billion
With a history that goes back more than a century, PepsiCo (NASDAQ: PEP) is a household name in food and beverages today and best known for its flagship soda.
Why Is PEP Not Exciting?
- Scale is a double-edged sword because it limits the company's growth potential compared to its smaller competitors, as reflected in its below-average annual revenue increases of 4.2% for the last three years
- Shrinking unit sales over the past two years imply it may need to invest in product improvements to get back on track
- Projected sales are flat for the next 12 months, implying demand will slow from its three-year trend
PepsiCo is trading at $131.80 per share, or 15.8x forward P/E. Read our free research report to see why you should think twice about including PEP in your portfolio.
Two Stocks to Watch:
KLA Corporation (KLAC)
Market Cap: $104.6 billion
Formed by the 1997 merger of the two leading semiconductor yield management companies, KLA Corporation (NASDAQ: KLAC) is the leading supplier of equipment used to measure and inspect semiconductor chips.
Why Do We Love KLAC?
- Annual revenue growth of 15.6% over the past five years was outstanding, reflecting market share gains this cycle
- Healthy operating margin of 35.9% shows it’s a well-run company with efficient processes, and its profits increased over the last five years as it scaled
- KLAC is a free cash flow machine with the flexibility to invest in growth initiatives or return capital to shareholders
KLA Corporation’s stock price of $779.30 implies a valuation ratio of 25.1x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Qualcomm (QCOM)
Market Cap: $166.4 billion
Having been at the forefront of developing the standards for cellular connectivity for over four decades, Qualcomm (NASDAQ: QCOM) is a leading innovator and a fabless manufacturer of wireless technology chips used in smartphones, autos and internet of things appliances.
Why Are We Positive On QCOM?
- Annual revenue growth of 11.3% over the last five years beat the sector average and underscores the unique value of its offerings
- Robust free cash flow margin of 30.4% gives it many options for capital deployment
- Market-beating returns on capital illustrate that management has a knack for investing in profitable ventures
At $150.20 per share, Qualcomm trades at 12.9x forward P/E. Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
Market indices reached historic highs following Donald Trump’s presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth.
While this has caused many investors to adopt a "fearful" wait-and-see approach, we’re leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free.
