Two Stocks With Potential for Outperforming the Nasdaq in the Next Five Years

Are you looking to ride the wave of the tech-fueled bull market and outperform the Nasdaq Composite over the next five years? Look no further than these two growth stocks that have the potential to smash the index’s historical rate of return.

  1. Nvidia (NASDAQ: NVDA)
    As the leading hardware supplier of choice for the world’s top cloud companies, Nvidia is well-positioned to capitalize on the outsized demand for artificial intelligence (AI). With data center spending expected to grow 18% annually and no competitive substitute for Nvidia’s GPUs, the company is projected to see substantial growth in the coming years. Despite increasing competition, Nvidia’s strong market position and high margins enable it to reinvest in the business and stay ahead of the game. The release of new products like the Blackwell GPUs and Rubin further solidifies its growth potential. With earnings surging 629% year over year, Nvidia is on track to outpace the average company in the Nasdaq Composite index.

  2. Datadog (NASDAQ: DDOG)
    Datadog’s DevOps platform is used by large companies to monitor cloud security and application performance, making it a key player in the cloud market. With revenue growing 27% year over year in the first quarter, Datadog’s superior growth compared to the broader cloud market indicates a competitive offering. The company’s low churn levels and continuous introduction of new products, like Bits AI, have earned it favor among customers. Analysts are projecting Datadog’s earnings to grow 17% annually over the long term, making it a compelling investment choice.
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Both Nvidia and Datadog have shown strong growth potential and are poised to outperform the Nasdaq Composite over the next five years. With a strategic focus on the burgeoning tech sector, these two companies offer investors the opportunity to capitalize on the evolving market dynamics and drive significant returns.

If you are considering investing in Nvidia, you may want to take note that the Motley Fool Stock Advisor team has identified the 10 best stocks for investors to buy now, and Nvidia wasn’t one of them. The stocks that made the cut are projected to deliver substantial returns in the coming years. With Stock Advisor’s track record of outperforming the S&P 500 since 2002, it’s worth exploring their recommendations for your investment portfolio.

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In conclusion, both Nvidia and Datadog represent solid growth opportunities in the tech sector that could outperform the Nasdaq over the next five years. Stay ahead of the curve and position yourself for success by considering these two growth stocks for your investment portfolio.