Nasdaq Stocks: Heavyweights Can Still Make You Money

It’s been a brutal third-quarter earnings season for most large Nasdaq stocks — disappointments everywhere. But analysts said some of these stocks could still redeem themselves soon.


Nine stocks in the Nasdaq 100 include scaler (ZS), Splenk (SPLK) and Marvell Technology Growth is expected to be 30% or more over the next 12 months, according to an Investor’s Business Daily analysis of S&P Global Market Intelligence and MarketSmith data. It’s not just a price target pipe dream. They are all credited with growing profits by 20% or more in the fourth quarter.

“This week will go down in history as one of the worst earnings seasons for big tech and could finally be a ‘fork in the road’ for the stalwarts looking to the future,” said Wedbush analyst Dan Ives. Alphabet and Microsoft see weakness in low guidance, spooked Wall Street, but Meta’s result…(was) an absolute train wreck speaks to a general digital advertising slump ahead for Zuckerberg & Co. as they make A metaverse of risky and head-scratching stakes.”

Finding Brighter Days for Big Nasdaq Stocks

Investing in large Nasdaq stocks, such as the 100 largest non-financial stocks, has been a tough year. The tech-heavy Nasdaq 100 fell 31% on falling earnings, a glut of various semiconductors, inflation and rising interest rates.

That’s why it’s so important that stocks in the Nasdaq 100 and S&P 500 remain strong. The third quarter was a bust for many. Analysts see profits for information technology companies in the S&P 500 falling nearly 5% in the third quarter, according to FactSet’s John Butters. Analysts expect the industry’s profits to fall just 1.8% in the fourth quarter.

“U.S. equities are struggling to find their way after mixed earnings accompanied by economic data that supports the view that the economy is weakening,” said Oanda’s Edward Moya.

Where the Nasdaq hopes for the highest

Zscaler, a well-run cloud security company, is an example of a veteran tech stock analyst still lagging behind. Shares are down more than 50 percent this year at $152.82. But analysts see the stock up nearly 39% in 12 months.

It’s not just wild guesswork. Analysts also believe that strong demand for the company’s products will push the company’s fourth-quarter adjusted earnings per share up 101% to 26 cents a share. If that happens, it would be the highest gain for Nasdaq 100 analysts to see a rebound over the next 12 months.

Another cloud software company, Splunk, is another example of high hopes. Analysts believe the stock will rise 1,300% over the next 12 months, helping to make up for a 43% decline so far this year. Analysts believe fourth-quarter profits rose 70%. Analysts are also hopeful for some chip companies. Specialized computer chip maker Marvell Technology expects shares to rise 77% next year. That was partly based on the company’s expected fourth-quarter profit growth of 26.4%.

The third quarter was a rough one for many large Nasdaq stocks. But analysts at least see a way out. It’s probably just not in the metaverse.

Does Nasdaq Stock Have a Future?

company symbol Equity implied upside Fourth-quarter EPS growth expected department
scaler (ZS) 38.6% 101.4% information Technology (JD) 1,313.5 70.0 consumer discretionary
Splenk (SPLK) 54.1 54.6 information Technology
Baidu (Baidu) 1,466.3 37.3 communication service
Marvell Technology (MRVL) 77.0 26.4 information Technology
analog device (Adi) 33.3 24.1 information Technology
Palo Alto Networks (PANW) 31.7 21.4 information Technology
Broadcom (AVGO) 41.4 21.4 information Technology
Microchip Technology (MCHP) 34.3 20.8 information Technology
Source: IBD, S&P Global Market Intelligence

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