In this article, we discuss 12 best NASDAQ stocks to buy in 2024. If you want to skip our discussion on the stock market and NASDAQ’s performance, head over to 5 Best NASDAQ Stocks To Buy In 2024.
In December 2023, the performance of the 106 tracked indexes was predominantly positive, with only five finishing in negative territory. The average return for all indexes was 7.1%, following a strong performance in November. The NASDAQ-100 recorded a 5.5% gain, bringing its year-to-date performance to 53.8% on a price return basis as of January 5, 2024. The best-performing index was the Nasdaq Dorsey Wright Healthcare Technical Leaders, up by 17.8%, while the Credit Suisse Nasdaq WTI Crude Oil FLOWS 106 TR was the worst performer, declining by 4.2%. Notably, there was strength across different areas, with significant gains in Nasdaq Thematic Tech Indexes, Nasdaq Thematic ESG Indexes, and Nasdaq Green Economy Indexes (up 8-9% on average), while Nasdaq Crypto Indexes all posted double-digit gains.
The market rally that began in early November continued, driven by positive economic data indicating easing inflation, leading to expectations of earlier-than-expected monetary policy adjustments by the Federal Reserve. This marked a significant shift from the August-October downturn when concerns about higher Treasury yields, decreased consumer confidence, and a new geopolitical conflict in the Middle East weighed on investors. While major technology firms continued to show strong gains at the year's end, the market rally expanded across different sectors that had underperformed in 2023, including small caps, biotech/healthcare, clean energy, and financials. In 2024, investor sentiment appears cautiously optimistic, with the notion of a soft landing gaining momentum and the technology sector well-positioned for growth due to the increasing adoption of AI.
The trend of growth outperforming value made a strong comeback, with a significant shift in relative performance between these two broad categories occurring three out of the last four years. In 2023, large-cap growth surpassed value by over 31 percentage points, ranking second only to the margin of over 35 percentage points observed in 2020. This contrasts with 2022, where value outperformed growth by more than 21 percentage points, marking its second-best relative performance since 1978. The ratio of growth to value (RLG / RLV) hit its lowest point in the first week of January 2023 and, by mid-November, came within 1% of the record highs previously established in August 2020 and December 2021.
Despite persistent macroeconomic concerns affecting demand and consumer sentiment, earnings in the fourth quarter of 2023 are surpassing expectations significantly, according to CNBC. Factors contributing to better bottom lines include reduced input costs, a focus on cost controls and efficiencies, and lowered expectations. LSEG, formerly Refinitiv, is now witnessing an almost 8% increase in earnings growth for this season, surpassing the 4.7% forecasted just three weeks prior, before major banks released results. Presently, 80% of S&P 500 earnings have exceeded estimates, slightly above the usual trend, with earnings exceeding expectations by more than 6%, though not reaching the 7% to 8% upside seen in the previous two quarters. Despite strong fourth-quarter results, there is a lack of positive momentum in forward-looking indicators, as first-quarter and full-year 2024 earnings estimates have decreased since January 1, with many companies offering cautious guidance in this earnings season.
To benefit from the growth momentum in the market, some of the best stocks to pick up in 2024 include Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Meta Platforms, Inc. (NASDAQ:META).
Our Methodology
We chose the top stocks listed on the NASDAQ exchange based on overall hedge fund sentiment toward each stock. We have assessed the hedge fund sentiment from Insider Monkey’s database of 910 elite hedge funds tracked as of the end of the third quarter of 2023. The list is arranged in ascending order of the number of hedge fund holders in each firm. Hedge funds’ top 10 consensus stock picks outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here).
Broadcom Inc. (NASDAQ:AVGO) is a global semiconductor company specializing in the design and development of complex digital and mixed-signal semiconductor devices. It operates in two segments – Semiconductor Solutions and Infrastructure Software. Broadcom Inc. (NASDAQ:AVGO) has projected a 2024 outlook with anticipated revenue of $50 billion and EBITDA margins of 60%. The company acknowledged some cyclical challenges in its broadband and storage semiconductor businesses but anticipates strength in the latter part of the year. Despite expected headwinds in the first half of 2024, investment advisory firm Summit Insights Group upgraded Broadcom Inc. (NASDAQ:AVGO) stock to Buy on December 8, expressing confidence that the company will likely outperform its outlook for 2024.
According to Insider Monkey’s third quarter database, Ken Fisher’s Fisher Asset Management is the largest stakeholder of Broadcom Inc. (NASDAQ:AVGO), with 2 million shares worth $1.70 billion. Overall, 87 hedge funds were bullish on the stock.
In addition to Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Meta Platforms, Inc. (NASDAQ:META), Broadcom Inc. (NASDAQ:AVGO) is one of the best NASDAQ stocks to monitor.
ClearBridge Multi Cap Growth Strategy made the following comment about Broadcom Inc. (NASDAQ:AVGO) in its Q2 2023 investor letter:
“While the ClearBridge Multi Cap Growth Strategy has limited mega cap exposure, which has been a recent headwind to relative performance, we own several companies that stand to benefit from the explosive growth in generative AI. These holdings play key roles in building out the necessary infrastructure and helping customers leverage capabilities enabled by this emerging technology.
Micron Technology, Inc. (NASDAQ:MU) is a global company engaged in the design, development, manufacturing, and sale of memory and storage products. The company operates through four segments – Compute and Networking Business Unit, Mobile Business Unit, Embedded Business Unit, and Storage Business Unit. Micron Technology, Inc. (NASDAQ:MU) is one of the best NASDAQ stocks to buy.
J.P. Morgan analyst Harlan Sur, with an Overweight rating, raised the price target on the stock to $105 from $90 on December 21. He emphasized the significance of high-bandwidth memory products, anticipating them to be a substantial revenue driver in 2024, driven by increased demand for memory in AI projects.
According to Insider Monkey’s third quarter database, 90 hedge funds were bullish on Micron Technology, Inc. (NASDAQ:MU), compared to 86 funds in the prior quarter. Ken Griffin’s Citadel Investment Group is the leading position holder in the company, with 8.10 million shares worth $551.6 million.
Here is what Claret Asset Management has to say about Micron Technology, Inc. (NASDAQ:MU) in its Q3 2022 investor letter:
“Inflation is still higher than interest rates… not an incentive to save for most people. Either inflation must come down or interest rates have to go up further. Or both. And probably both. Now that they are taking the punch bowl away and the party is over, what happens next? For whatever reason, the stock market seems to always precede the economic reality: Micron reached a high of $98.45 on January 5th, 2022 and is trading at $50.00 today.”
Netflix, Inc. (NASDAQ:NFLX) is one of the best NASDAQ stocks for 2024. On January 23, Netflix, Inc. (NASDAQ:NFLX) reported a Q4 GAAP EPS of $2.11, falling short of Wall Street estimates by $0.11. Revenue for the period increased 12.5% year-over-year to $8.83 billion, topping market expectations by $120 million. The global streaming paid memberships increased by 13.12 million to 260.28 million. Netflix revealed Q1 2024 guidance, indicating anticipated revenue of $9.24 billion compared to the consensus estimate of $9.26 billion, and projected earnings per share (EPS) of $4.49 as opposed to the consensus estimate of $4.14.
According to Insider Monkey’s third quarter database, 102 hedge funds were bullish on Netflix, Inc. (NASDAQ:NFLX), compared to 114 funds in the preceding quarter. Boykin Curry’s Eagle Capital Management is one of the biggest stakeholders of the company, with 2.5 million shares worth over $970 million.
Polen Focus Growth Strategy stated the following regarding Netflix, Inc. (NASDAQ:NFLX) in its fourth quarter 2023 investor letter:
“In the fourth quarter, the top relative and absolute contributors to the Portfolio’s performance were Netflix, Inc. (NASDAQ:NFLX), ServiceNow, and Salesforce.
During Netflix’s pandemic grow-over issues in 2022, the market seemed to believe there was little revenue or free cash flow growth left to be had for this business. The pandemic had pulled forward user growth, and the company then disclosed that there were over 100 million households that were using Netflix but not paying for it by borrowing a paid user’s account. After we assessed this information, better understood how the company could monetize shared passwords, and realized the win-win for Netflix and consumers from introducing an ad-supported subscription tier, we meaningfully added to our position in Netflix in the summer of 2022. We saw a clear path to much better monetization of an already robust and differentiated platform with a continued commitment to improved content spend efficiency and free cash flow growth.
Advanced Micro Devices, Inc. (NASDAQ:AMD) is a global semiconductor company operating in the Data Center, Client, Gaming, and Embedded segments. It is one of the best NASDAQ stocks to invest in 2024. Advanced Micro Devices, Inc. (NASDAQ:AMD) has increased its CPU microprocessor market share to 18.4% in the fourth quarter, marking a gain of 73 basis points, according to data from Mercury Research cited by investment firm Citi. Citi holds a Buy rating on AMD as of February 7.
According to Insider Monkey’s third quarter database, Advanced Micro Devices, Inc. (NASDAQ:AMD) was part of 110 hedge fund portfolios, compared to 112 in the prior quarter. Philippe Laffont’s Coatue Management is a prominent stakeholder of the company, with a position worth $1.28 billion.
White Falcon Capital Management stated the following regarding Advanced Micro Devices, Inc. (NASDAQ:AMD) in its fourth quarter 2023 investor letter:
“It is important to note that the returns depicted above actually originated in the market turmoil of 2022 and were only realized in 2023. We assess that about 75% of the returns in 2023 were derived from just 35% of the portfolio. Notably, the technology companies we acquired in 2022 – Advanced Micro Devices, Inc. (NASDAQ:AMD), Amazon, Docebo, NU, Rover – performed exceptionally well. In hindsight, the decision to allocate to technology stocks appears straightforward; but it actually demanded courage and conviction to buy and add to these stocks during the fear and uncertainty of the 2022 bear market.
Adobe Inc. (NASDAQ:ADBE) is a global software company operating in three segments – Digital Media, Digital Experience, and Publishing and Advertising. It is one of the best NASDAQ stocks to buy in 2024. On December 13, Adobe Inc. (NASDAQ:ADBE) reported a Q4 non-GAAP EPS of $4.27 and a revenue of $5.05 billion, outperforming Wall Street estimates by $0.13 and $30 million, respectively.
According to Insider Monkey’s third quarter database, 112 hedge funds were bullish on Adobe Inc. (NASDAQ:ADBE), compared to 109 funds in the prior quarter. Ken Fisher’s Fisher Asset Management is the largest stakeholder of the company, with 4.5 million shares worth $2.3 billion.
Here is what Polen Global Growth has to say about Adobe Inc. (NASDAQ:ADBE) in its Q3 2023 investor letter:
“Both Alphabet and Adobe’s businesses continue to perform well. With respect to Adobe, the most recent quarter delivered more of the same with constant currency revenue growing 13%, margin expansion, and over 2% of shares outstanding repurchased for non-GAAP earnings growth of over 20%. We believe its approach to GenAI through Firefly, which guarantees safe content because it trains on Adobe Stock, will continue to be attractive to enterprises. The counter to GenAI, and something we are keeping an eye on with Alphabet and Adobe, is that it requires heavy investment. While both businesses can leverage their scale and manage costs in other areas, we expect the investment in future growth through GenAI will weigh on company-wide margins over the near term.”
Apple Inc. (NASDAQ:AAPL) ranks 7th on our list of the best NASDAQ stocks to invest in 2024. On February 1, Apple Inc. (NASDAQ:AAPL) reported a FQ1 GAAP EPS of $2.18 and a revenue of $119.6 billion, outperforming Wall Street estimates by $0.07 and $1.34 billion, respectively. Apple also declared a $0.24 per share quarterly dividend, in line with previous. The dividend is payable on February 15, to shareholders of record on February 12.
According to Insider Monkey’s third quarter database, 134 hedge funds were bullish on Apple Inc. (NASDAQ:AAPL), compared to 135 funds in the preceding quarter. Warren Buffett’s Berkshire Hathaway is the largest stakeholder of the company, with 915.5 million shares worth $156.75 billion.
Bireme Capital stated the following regarding Apple Inc. (NASDAQ:AAPL) in its fourth quarter 2023 investor letter:
“We also shorted Apple Inc. (NASDAQ:AAPL) in Q3. At our average price of around $190 per share, Apple traded at 30x peak earnings and a $2.8 trillion market cap. While Apple is indeed a magnificent company, this valuation is simply too rich for a business with a substantial cyclical component. The company is projected to grow revenue at a mere 4% rate between 2022 and 2026. We think the total return on Apple stock will be lower than the market, and especially our long positions, over the next few years.”
Alphabet Inc. (NASDAQ:GOOG) is one of the best NASDAQ stocks to invest in. On January 30, Alphabet Inc. (NASDAQ:GOOG) reported its fourth quarter results. The GAAP earnings per share came in at $1.64 and the revenue stood at $86.31 billion, outperforming Wall Street estimates by $0.04 and $1.04 billion, respectively.
Alphabet Inc. (NASDAQ:GOOG) has reintroduced its AI chatbot, now named Gemini, as a subscription service with different tiers, following a model similar to OpenAI's ChatGPT. The service, ranging from a free version to the premium Ultra 1.0 model priced at $19.99 per month, can perform complex tasks such as coding, creative collaboration, and logical reasoning.
According to Insider Monkey’s third quarter database, 163 hedge funds were long Alphabet Inc. (NASDAQ:GOOG), compared to 152 funds in the prior quarter. Harris Associates is a prominent stakeholder of the company, with a position worth $3 billion.
Like Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Meta Platforms, Inc. (NASDAQ:META), hedge funds are piling into Alphabet Inc. (NASDAQ:GOOG).
The FPA Crescent Fund stated the following regarding Alphabet Inc. (NASDAQ:GOOG) in its fourth quarter 2023 investor letter:
“Alphabet Inc. (NASDAQ:GOOG) continued going from strength to strength during 2023 despite concerns that competition may infringe on the company’s dominant position in Search. Thus far, Alphabet has continued to hold its own, and we look forward to seeing how the company incorporates further AI developments across the Alphabet ecosystem. Lastly, we are hopeful that the impending arrival of a new CFO will bring a renewed focus on efficiency – an area where we believe Alphabet has ample room for improvement.”
