From Nasdaq: 2024-06-21 04:20:00

The Nasdaq Composite has surged 30% in the past 12 months, well above its historical growth rate of 11%. Investors seeking outperformance should focus on stocks with higher earnings per share growth potential. Nvidia and Datadog are two companies poised to exceed the index’s historical returns over the next five years.

Nvidia dominates the AI chip market, with cloud service providers projected to spend $260 billion on data center infrastructure by 2023. The company’s new GPU products are in high demand, driving a 629% increase in earnings last quarter. Analysts forecast Nvidia’s earnings to grow at a rate of 31% annually, surpassing the Nasdaq average.

Datadog’s DevOps platform is utilized by large companies for cloud monitoring, leading to a 27% revenue growth year over year in the first quarter. The company’s continuous introduction of new products, like Bits AI, solidifies its competitive edge in the cloud monitoring market. Analysts predict Datadog’s earnings to grow 17% annually, indicating strong potential for long-term returns.

Consider diversifying your investment portfolio with the 10 best stocks recommended by the Motley Fool Stock Advisor team, as Nvidia did not make the cut. Stock Advisor has substantially outperformed the S&P 500 since 2002, providing investors with valuable guidance on building profitable portfolios. With the right investment strategy, you could see significant returns over time.



Read more at Nasdaq: 2 Growth Stocks That Could Outperform the Nasdaq Over the Next Five Years