Although a listing on the New York Stock Exchange (NYSE) is considered the ultimate pinnacle of success, for retail investors seeking growth opportunities, the best stocks to buy are often found on the Nasdaq. Historically, the Nasdaq leans heavily on technology firms, which of course has been instrumental in forging the present information and internet age.
Not only that, the numbers speak for themselves. Over the trailing five years, the benchmark S&P 500 index gained approximately 108%. On the other hand, the high-flying Nasdaq index more than doubled this profitability to the tune of nearly 219% over the same period. Basically, as we move forward, the Nasdaq tends to incorporate more of the best stocks to buy that are relevant to our era.
However, you don’t want to make the assumption that the Nasdaq is all about technology. While that sector is its forte, many of the best stocks to buy hail from other market subsegments. Especially now, the index features a surprisingly diverse mix of publicly traded companies, which I hope to demonstrate with this list.
Also, if retirement is not imminent for you (meaning you’ve got some time to grow your portfolio), you should consider researching potential best stocks to buy from the Nasdaq as opposed to NYSE names. Certainly, there’s nothing wrong with the latter. But some of the top names that we’ve seen in the past few years, such as Advanced Micro Devices (NASDAQ:AMD) and Tesla (NASDAQ:TSLA), are Nasdaq listed.
Put another way, if you’re not looking to support yourself on dividends, the younger index has plenty of opportunities — and diverse ones at that. For this list, I’ve deliberately attempted to keep away from the hottest flavors of the week. Since there’s a lot of pain still baked into the economy, bag-holding remains a risk. Instead, I included a wide selection of companies featuring narratives that are relevant in the new normal. So, without further ado, here are the best stocks to buy on the Nasdaq right now:
- Freshpet (NASDAQ:FRPT)
- Adobe (NASDAQ:ADBE)
- Intuit (NASDAQ:INTU)
- Nvidia (NASDAQ:NVDA)
- Dollar Tree (NASDAQ:DLTR)
- Match Group (NASDAQ:MTCH)
- Check Point Software Technologies (NASDAQ:CHKP)
- Smith & Wesson Brands (NASDAQ:SWBI)
- Sirius XM (NASDAQ:SIRI)
- U.S. Gold Corp (NASDAQ:USAU)
Best Stocks on the Nasdaq: Freshpet (FRPT)
Having already gone ballistic over the last five years, Freshpet is admittedly not one of the Nasdaq companies that will make you rich overnight. However, it’s incredibly pertinent to the current generation of young Americans. With millennials representing the largest workforce in the U.S. labor market, what they believe matters — and that bodes well for FRPT stock.
Here’s the backdrop: Millennials prefer pet ownership over children. In a cynical way, I can understand this. Since millennials are the “me” generation, you don’t want other humans competing for the spotlight. However, since pets are different species than us — they better be or we have some problems — the competition element doesn’t exist.
Also, the novel coronavirus will likely push FRPT stock higher. As you know, we’ve been isolated from our friends and family during the lockdowns. Pets play an important role in companionship and in overall wellness.
In return, the humans will give the best for their four-legged friends. Thus, Freshpet is one of the best stocks to buy over the long term.
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Another name among the best stocks on the Nasdaq, Adobe is worth considering for its immediate and long-term relevance.
For the present environment, the Covid-19 crisis has pushed employees to work from home. While this has been a largely welcome development in an otherwise terrible time, it poses logistical nightmares in terms of administrative duties. However, Adobe can alleviate much of this pressure through its Adobe Sign business, which is a cloud-based e-signature service.
True, competition in this arena is heating up. However, Adobe can also bank on its creative content portfolio. That’s because many worker bees will invariably join the gig economy after having received a taste of the independent telecommuting lifestyle. Therefore, Adobe’s Software-as-a-Service (SaaS) platform should perform well in the coming years, making ADBE stock an intriguing buy.
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I’m going to be straightforward with you: Intuit has got to be one of the most boring investments on the Nasdaq. Simultaneously, it may very well be one of the best stocks listed on the exchange to buy, and I don’t consider that a contradiction.
Yes, there are encouraging economic data to celebrate, such as unemployment claims falling more than expected recently. But that overlooks some of the harrowing stories of job cuts and desperation across this country. Put another way, boring is good during this time.
Also, boring, in the case of INTU stock, is relevant. As a software giant with a specialty toward tax-preparation software, Intuit obviously has significance with April 15 just a few months away. But over the years ahead, I believe the company will see an increase in demand as the gig economy expands.
After all, new members of this burgeoning space will discover that taxes are a lot different between employees and independent contractors/businesses. It’s a very forward-looking investment, though, so only patient buyers need consider INTU stock.
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As a consistently strong investment, Nvidia is almost guaranteed a place regarding discussions about the best stocks on the Nasdaq. Currently, NVDA stock has two massive tailwinds that should turn out well for the underlying company.
First, Nvidia is arguably best known for its graphics processing units, or GPUs. These powerful processors enable hardcore gamers to play the latest games at the highest frame rate possible. As well, with e-sports and online gaming becoming a staple in the broader video-game industry, demand for topnotch GPUs will likely increase.
Plus, Americans have stated they won’t go out to enjoy high-contact entertainment venues for some time. Cynically, this should lift the case for NVDA stock, as in-home entertainment still carries a premium sentiment-wise.
Second, cryptocurrencies are soaring, raising demand for processors that can handle the energy-intensive process of crypto mining. With institutional money pouring into virtual currencies, Nvidia is one of the best stocks to buy for patient investors.
Dollar Tree (DLTR)
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After discussing compelling tech plays, I don’t want to be a bummer and mention something like Dollar Tree. An investment that’s more in line with expectations of a recession, DLTR stock is somewhat of a red-haired stepchild on the Nasdaq. Nevertheless, it could turn out to be one of the best stocks to buy, although perhaps for unfortunate reasons.
As I mentioned earlier, the economic datapoints we receive on a weekly and monthly basis don’t exactly characterize the true human cost of the Covid-19 pandemic. Also, it’s worth reminding ourselves that according to data from the U.S. Employment and Training Administration, weekly initial jobless claims peaked at 665,000 during the Great Recession.
Over the past year, we’ve had months and months of initial claims that consistently exceed the Great Recession peak. That right there tells you that we have a catastrophic hole in our economy. As a result, this dynamic is a cynical tailwind for DLTR stock.
At the very least, you may benefit from Dollar Tree as a hedge — just in case the smelly stuff hits the fan.
Match Group (MTCH)
Perhaps the most obvious impact of the novel coronavirus — at least for singles — is the overnight destruction of the dating scene. Suddenly, meeting that special someone took a backseat to staying alive and healthy. It’s a terrible reason why Match Group became so profoundly relevant, but it is what it is. Don’t fight the tape, and just accept MTCH as one of the best socks to buy on the Nasdaq right now.
Sure, MTCH stock has doubled over the trailing year. And it’s not off to the most auspicious of starts in the new year. But as I mentioned earlier, Americans are scared to go out to traditional entertainment venues like movie theaters. So if we’re concerned about breathing the same air, that doesn’t augur well for the in-person dating scene.
Plus, if people don’t want to watch the latest blockbusters because of potential infection from others, what about nightclubs and concerts and other once-popular hangouts? Granted, not everybody is fearful of Covid-19. But many are, and they will use online dating to build trust first before meeting in person. Thus, I like MTCH stock longer term.
Check Point Software Technologies (CHKP)
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Check Point Software Technologies is a weird one and not because of the underlying business. Indeed, I believe CHKP is an incredibly relevant investment given our circumstances. Unfortunately, most other investors didn’t see it that way, sending shares tumbling despite a strong earnings report.
It’s bizarre, but these things happen. Despite encouraging financial results, investors wanted Check Point to do more with the newfound growth. Personally, I find the sentiment irrational, but I’m not going to argue with it — it is what it is. But it’s also a discount, which is what makes the red ink intriguing.
With the worker bees sent home to operate remotely, they have the benefit of not having to commute and fight through traffic. While that’s wonderful for the employees, it’s a nightmare for cybersecurity. Essentially, the surface area of vulnerability points has expanded dramatically. That’s not great news for enterprises, but it does benefit CHKP stock.
And who knows? Maybe remote work won’t go away when the pandemic does. If so, look for Check Point to make good as one of the best stocks to buy.
Smith & Wesson Brands (SWBI)
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Let me break the fourth wall and state that if you’re reading a cookie-cutter article about best stocks to buy, chances are, I didn’t write it. Yes, it drives some people nuts that I explore the controversial side of the financial markets. However, if you wanted dry, boring literature, you’d be spending your time exclusively at Reuters or AP, am I right?
Anyways, we’ve got to talk about guns, and when we talk about guns, we’ve got to mention my two friends Smith & Wesson Brands. Ah yes. If there’s anything that Americans build well, it’s tools of destruction. Although I don’t own SWBI stock, I’m a big fan of the underlying products, particularly the almighty .500 Magnum revolver. I personally can attest to the manufacturing quality of Smith & Wesson’s products.
Here in the U.S., we have record-breaking gun sales, which are constantly making the news. However, let me tell it to you straight: You will be surprised at how many people own guns and don’t talk about it. Obviously, it’s a cynical investment, but you should seriously consider SWBI stock.
Sirius XM (SIRI)
From the get-go, I think Sirius XM is one of the riskiest choices on the Nasdaq. However, it could turn out to be one of the best stocks to buy in anticipation of a return to somewhat normal.
Naturally, the case for SIRI stock took a beating during the worst part of the Covid-19 crisis. With employees being sent home, there wasn’t much need for in-car satellite radio and audio entertainment. Frankly, you have a lot of free options sitting at home, which didn’t favor Sirius competition-wise.
However, I’m not entirely sure workers will permanently stay at home. For one thing, the lack of separation between home life and work life can irritate people. Further, I highly doubt that companies will pay the same salary for their employees to sit at home all day. Let’s face it — most workers are lazy on the job, so I don’t buy this nonsense that they suddenly found increased productivity at home.
Plus, here’s something to ponder: Most Americans prefer to travel in their personal vehicles during this time as opposed to public transportation. This suggests there’s a hidden opportunity for satellite radio, which may benefit SIRI stock.
U.S. Gold Corp (USAU)
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Among the best stocks on the Nasdaq, U.S. Gold Corp may be the most ironic. That’s because people typically buy gold as a safe haven against uncertainty or unsustainable speculation in equities. Certainly, the Nasdaq exchange features a number of wild investments that gold hedges against.
Setting that aside, I believe USAU stock deserves inclusion in the high-risk, high-reward portion of your portfolio. First, U.S. Gold Corp features a low float relative to other gold-mining firms. This is hugely important as so many precious metal companies are dilutive as heck.
Second, the projects underlining USAU stock are all located in the U.S. as the corporate name suggests. This dynamic distinguishes USAU from its rivals, and it may be even more important due to the shaky geopolitical environment.
Finally, the recent volatility in gold prices may be irrational. Yes, Wall Street valuations are sky high. But it’s far from clear how we will recover from the pandemic. Even feel-good narratives, like the proposed cancellation of student debt, can have untold consequences for the economy.
I like gold because the fear trade is underappreciated. And that could eventually spill over into higher prices for USAU.
On the date of publication, Josh Enomoto held a long position in gold.
A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.