The Nasdaq 100 keeps hitting new all-time highs. No longer just a handful of stocks are driving the index higher, this is a broad-based rally. Nearly three-quarters of the index’s components show positive returns this year, though a few Magnificent Seven stocks are doing their part. Not surprisingly, Nvidia (NASDAQ:NVDA) leads the way as of this writing with a neat double so far.
Although more than a third of the component stocks are in the technology sector some of the best performers are not. Utility stock Constellation Energy (NASDAQ:CEG), for example, is the second-best stock in the index. Its stock is up 88% as data center artificial intelligence demand is driving the need for more electricity higher.
Those factors ought to keep stocks already running hot climbing further. The following three all-star companies are Nasdaq 100 stocks to buy now as they have much more room to run.
Advanced Micro Devices (AMD)
Arguably Advanced Micro Devices (NASDAQ:AMD) is the better stock to buy now over Nvidia. While the leading chipmaker is seeing explosive growth, it is going to be coming up against hard-to-beat numbers as the year progresses. Nvidia’s growth won’t look so dynamic in the quarters ahead. Not so with Advanced Micro Devices. Its explosive growth is coming.
For one, a new channel of growth just opened up for it. Microsoft (NASDAQ:MSFT) recently said it will offer AMD’s powerful MI300X AI chips to its customers using the Azure cloud services platform.
Wall Street thinks AMD can see $2 billion in run-rate revenue this year for the MI300 accelerators. CEO Lisa Su recently raised her forecast for data center graphics processing units (GPU) revenue to hit $4 billion this year, double the amount she predicted last year. Su also said the MI300 accelerator will drive 80% of that growth.
Advanced Micro Devices is just gaining its stride in this area. Although Nvidia has been at it for longer and still owns the market, there is significant upside potential for AMD making it a top Nasdaq 100 stock to buy.
O’Reilly Automotive (ORLY)
Aftermarket auto parts is a lot more mundane than AI chips but O’Reilly Automotive (NASDAQ:ORLY) can still step on the gas. The hidden nature of such stocks makes them powerful drivers of stellar returns. O’Reilly Automotive has been like a twin-turbo V8 engine hiding under the hood of an old Ford (NYSE:F) Fiesta. Over the past decade, O’Reilly stock has returned 580% for investors, or more than twice the results of the S&P 500‘s 240% returns.
The reason for the outperformance is that people need their cars to work. Whether its the do-it-yourself grease monkey or the do-it-for-me mechanic, O’Reilly sells the auto parts both need to keep a jalopy on the road. Particularly in the aftermath of the pandemic when supply chains caused new and used car shortages, but also in the high inflation period that we’re still going through, keeping an existing vehicle on the road is more important than ever.
The average age of a car on the road in the U.S. is a record 12.6 years. Because new cars cost so much, it is cheaper to fix up an old one. Although O’Reilly’s stock fell after first-quarter results were released because the growth was less than what Wall Street expected, auto industry conditions aren’t improving. O’Reilly Automotive’s business is still essential and will rev up its growth engines in the near future.
Exelon (EXC)
For the exact same reasons Constellation Energy has been a star performer this year, fellow utility operator Exelon (NASDAQ:EXC) should be seen in the same light.
Data center demand will accelerate growth in the coming quarters and years. Exelon, which operates in Illinois and Pennsylvania, says data centers and other businesses have approached the utility about supporting their demand needs. CEO David Butler told analysts earlier this month, Exelon “continue to see significant activity around high-density load growth in general…we have high probability of load growth, not only in Illinois, but Pennsylvania.”
Analysts don’t believe Exelon has done as much work yet as other utility operators have with data centers. However, considering the industry’s exponential growth trajectory, it should allow the utility to capture its fair share of the market. Look for heightened opportunities in the back half of 2024.
That potential has Exelon stock moving 15% off the lows it hit earlier this year. Although the utility operator still faces some regulatory headwinds, EXC stock should outperform for the immediate future.
On the date of publication, Rich Duprey did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.