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. That said, 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: $113 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 Do We Pass on SBUX?
- Lagging same-store sales over the past two years suggest it might have to change its pricing and marketing strategy to stimulate demand
- Efficiency has decreased over the last year as its operating margin fell by 6.8 percentage points
- Incremental sales over the last six years were much less profitable as its earnings per share fell by 5.9% annually while its revenue grew
Starbucks’s stock price of $99.05 implies a valuation ratio of 40.1x forward P/E. To fully understand why you should be careful with SBUX, check out our full research report (it’s free).
Two Stocks to Watch:
MercadoLibre (MELI)
Market Cap: $84.66 billion
Originally started as an online auction platform, MercadoLibre (NASDAQ: MELI) is a one-stop e-commerce marketplace and fintech platform in Latin America.
Why Do We Love MELI?
- 107% annual increases in its average revenue per user over the last two years show its platform is resonating with power users
- Performance over the past three years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
- Strong free cash flow margin of 35.9% enables it to reinvest or return capital consistently, and its growing cash flow gives it even more resources to deploy
At $1,668 per share, MercadoLibre trades at 16.1x forward EV/EBITDA. Is now the time to initiate a position? See for yourself in our full research report, it’s free.
Costco (COST)
Market Cap: $447.4 billion
Designed to be a one-stop shop for the suburban consumer, Costco (NASDAQ: COST) is a membership-only retail chain that sells groceries, apparel, toys, and household items, often in bulk quantities.
Why Is COST Interesting?
- Brick-and-mortar locations are witnessing elevated demand as their same-store sales growth averaged 6.2% over the past two years
- Massive revenue base of $286.3 billion makes up for its weaker gross margin and makes it a household name that influences purchasing decisions
- Industry-leading 34.7% return on capital demonstrates management’s skill in finding high-return investments, and its returns are climbing as it finds even more attractive growth opportunities
Costco is trading at $1,008 per share, or 47.2x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren't just high-quality businesses. Something is happening with them right now. Elite fundamentals meeting near-term momentum — both boxes checked at the same time.
Find out which stocks our AI platform is flagging this week. See this week's Strong Momentum stocks — FREE. Get Our Strong Momentum 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-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.
