The Nasdaq 100 (^NDX) is known for housing some of the most innovative and fastest-growing companies in the market. But not every stock in the index is a winner - some are struggling with slowing growth, increasing competition, or unsustainable valuations.
Even among high-growth companies, some are struggling, which is why we built StockStory - to help you separate winners from losers. Keeping that in mind, here are two Nasdaq 100 stocks that could lead the market and one best left off your watchlist.
One Stock to Sell:
Starbucks (SBUX)
Market Cap: $116.6 billion
Started by three friends in Seattle’s historic Pike Place Market, Starbucks (NASDAQ: SBUX) is a globally-renowned coffeehouse chain that offers a wide selection of high-quality coffee, beverages, and food items.
Why Are We Wary of SBUX?
- Poor same-store sales performance over the past two years indicates it’s having trouble bringing new diners into its restaurants
- Projected sales decline of 2.6% for the next 12 months points to a tough demand environment ahead
- Expenses have increased as a percentage of revenue over the last year as its operating margin fell by 4.9 percentage points
At $104.30 per share, Starbucks trades at 38x forward P/E. If you’re considering SBUX for your portfolio, see our FREE research report to learn more.
Two Stocks to Buy:
KLA Corporation (KLAC)
Market Cap: $315 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 Are We Backing KLAC?
- Annual revenue growth of 15.2% over the last five years was superb and indicates its market share increased during this cycle
- Disciplined cost controls and effective management resulted in a strong two-year operating margin of 40%, and its rise over the last five years was fueled by some leverage on its fixed costs
- Robust free cash flow margin of 30.5% gives it many options for capital deployment
KLA Corporation is trading at $248.67 per share, or 54.4x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
Netflix (NFLX)
Market Cap: $342.2 billion
Launched by Reed Hastings as a DVD mail rental company until its famous pivot to streaming in 2007, Netflix (NASDAQ: NFLX) is a pioneering streaming content platform.
Why Is NFLX a Good Business?
- Global Streaming Paid Memberships are rising, meaning the company can increase revenue without incurring additional customer acquisition costs if it can cross-sell additional products and features
- Share buybacks catapulted its annual earnings per share growth to 49.2%, which outperformed its revenue gains over the last three years
- Free cash flow margin jumped by 16.2 percentage points over the last few years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
Netflix’s stock price of $73.86 implies a valuation ratio of 17.1x forward EV/EBITDA. Is now the right time to buy? Find out in our full research report, it’s free.
High-Quality Stocks for All Market Conditions
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
But our AI platform says the party isn’t over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating Stocks for Free HERE.
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.
