The Nasdaq Composite lists thousands of publicly-traded stocks in various industries. The index has more than doubled over the past five years and looks like it will continue to march higher. Many Nasdaq stocks have outperformed inflation and savings accounts, but some of them have stood out against promising investment opportunities like real estate.
Buying the best Nasdaq stocks allows investors to generate solid returns without much effort. You don’t have to manage properties or look at the stock market every day. It only takes a few hours each week to monitor your investments to ensure the growth catalysts are still in place.
However, past returns do not guarantee future successes. While momentum indicates how investors feel about a stock, it’s important to look at a company’s financials before committing to an investment. Revenue, profits and growth rates are key factors to consider. Investors can choose from many stocks, but these three Nasdaq stocks show a lot of promise for long-term investors.
Robinhood (HOOD)
Robinhood (NASDAQ:HOOD) has become the preferred trading app for millions of consumers. The fintech firm forced many changes in the industry with zero-fee trades, forcing other brokerage firms to trim their fees. Robinhood is innovating in another way that can lead to more changes within the industry.
Robinhood Gold memberships offer incentives that are hard to match. Members receive 1% deposit boosts, 3% IRA matches, 5% APY on their idle cash, a credit card with unlimited 3% cashback across the board and other perks. Robinhood closed out the first quarter with 1.7 million members, which is a 42% year-over-year increase.
This membership program was one of the catalysts for Robinhood’s successful quarter. Revenue increased by 40% year-over-year with a 59% year-over-year increase in transaction-based revenue leading the way. Cryptocurrency revenue was a key highlight that grew by 232% compared to the same quarter last year. As Robinhood continues to attract more users and offer innovative products, shares should continue to rally. They have almost doubled year-to-date.
Nvidia (NVDA)
Nvidia (NASDAQ:NVDA) has led the AI charge. It’s also one of the main reasons the Nasdaq Composite and S&P 500 set several all-time highs in 2024. The company has numerous partnerships with tech giants that should help it maintain a big lead in the AI industry. Shares have more than doubled year-to-date while logging otherworldly gains over the past five years.
The semiconductor giant continues to report exceptional earnings as its AI chips remain the preferred choice. Revenue reached a record $26 billion in Q1 FY25, representing 262% year-over-year growth. Net income sprang up by 629% year-over-year.
AI chips for data centers are the key growth driver, but Nvidia is also generating revenue from other segments. Gaming revenue increased by 18% year-over-year while Professional Visualization revenue increased by 45% year-over-year. Even the Automotive and Robotics segment reported a solid 11% year-over-year growth rate in the quarter. Nvidia looks poised to generate long-term returns for investors as AI chip demand remains strong.
Meta Platforms (META)
Online platforms that grab people’s attention and keep them around for several hours each day can make a lot of money from advertisements. Meta Platforms (NASDAQ:META) is one of the leaders in the industry thanks to its social media platforms. The company has 3.24 billion daily active users across Facebook, Instagram, WhatsApp and its other platforms. That figure represents a 7% year-over-year improvement compared to the same quarter last year.
User growth isn’t the only catalyst that’s excited Wall Street analysts. Meta Platforms reported 27% year-over-year revenue growth and 117% year-over-year net income growth in the first quarter. Profit margins soared to 33.9% as the company continues to cut costs and grow its top line.
Meta Platforms is currently rated as a “Strong Buy” with a projected 13% upside. The highest price target of $630 per share suggests that the stock can gain an additional 34% from current levels.
On this date of publication, Marc Guberti held a long position in NVDA. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or
indirectly) any positions in the securities mentioned in this article.