The Nasdaq stock exchange lists numerous corporations, and some of them present attractive long-term buying opportunities. While trades can make some money by correctly timing their buy and sell points, time in the market often beats timing the market.
Buying cheap Nasdaq stocks with decent margins of safety can minimize losses during the bad times and amplify gains during the good times. Value is in the eye of the beholder, but analysts have been parading these Nasdaq stocks with buy recommendations.
Costco (COST)
The global retailer is currently rated as a Moderate Buy among 23 analysts. Many consumers recognize Costco (NASDAQ:COST) as the go-to destination for affordable products. Sales have been ticking higher for the company based on its April results. Year-over-year results were up by 5.8% over the past 4-week period and up by 4.1% over the past 35-week period. E-commerce sales during those periods exhibited 14.6% and 14.7% year-over-year (YoY) gains, respectively.
Costco shares are up 19% year-to-date and have gained 214% over the past five years. The company currently has a 51 P/E ratio and continues to expand its profit margins. People will continue to buy from Costco during economic slowdowns, and more people may visit its wholesale locations as prices continue to increase.
Investors also get to enjoy a 0.60% yield. Costco occasionally announces special dividends that are significant paydays for investors, but the regular dividend is growing just fine. The firm has maintained a 12.65% annualized dividend growth rate over the past decade.
Alphabet (GOOG, GOOGL)
Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) trades at a 27 P/E ratio, which feels low relative to other tech companies. It’s also low in comparison to non-tech companies like Chipotle (NYSE:CMG).
Revenue and net income growth have both been revving up for the company. Alphabet reported 16% YoY revenue growth and 57% YoY income growth in Q1 2024. Those results helped the stock climb 23% year-to-date. It’s also up 200% over the past five years.
Alphabet is tapping into artificial intelligence and cloud computing to diversify its revenue and accelerate its sales. Advertising is still the core component, but Google Cloud represents 10% of the company’s total revenue. Google Cloud is also growing at a faster rate than Alphabet’s advertising channels.
The stock can attract more investors due to its recent dividend. Alphabet announced its first quarterly dividend of $0.20 per share. It’s not much, but Alphabet should maintain a high annualized growth rate for several years. Shares currently offer a 0.47% yield.
Marriott International (MAR)
Hotel traveling is projected to achieve a compounded annual growth rate of 3.32% from now until 2028. However, some hotel chains will benefit more than others, and Marriott International (NASDAQ:MAR) has positioned itself to perform well as the demand for travel remains strong.
The firm has nearly 8,800 properties in 139 countries and territories. Marriott International has more than 30 leading brands under its corporate umbrella. The company has been around since 1927, so it’s poised to withstand economic uncertainty.
Marriott reported 4.2% YoY comparable systemwide revenue growth in Q1 2024. The company also recently announced a quarterly dividend increase from $0.52 to $0.63 per share. That’s a 21% YoY increase. Marriott International stock is up by 5% year-to-date and has gained 83% over the past five years.
Analysts have rated the stock as a Moderate Buy and gave it a projected 8% upside. The highest price target of $280 per share suggests the stock can rally by an additional 19% from current levels.
Synopsys (SNPS)
Synopsys (NASDAQ:SNPS) is a chipmaker that regularly reports exceptional revenue and earnings growth. The company didn’t disappoint in the first quarter of fiscal 2024. Revenue reached a record $1.649 billion, up 21% YoY. GAAP earnings per diluted share reached $2.89, exceeding the high end of guidance. Net income rose by 65% YoY.
Investors have noticed. The stock is up by 10% year-to-date and has soared by 360% over the past five years. Shares are currently coming out of a correction and trade at a 64 P/E ratio. Long-term growth opportunities, net income growth and AI tailwinds help to justify the current valuation.
A multi-year timeframe can benefit investors, but price targets from analysts suggest it’s not a good idea to stay on the sidelines. Synopsys has a consensus Strong Buy rating with a projected 14% upside from current levels. The highest price target of $675 per share indicates the stock can potentially gain another 21%.
Qualcomm (QCOM)
Qualcomm (NASDAQ:QCOM) is another chipmaker benefitting from artificial intelligence. While the company had some headwinds in 2023 due to a slower smartphone market, those headwinds are subsiding. Many smartphone companies are talking about incorporating AI in their newest products. Those features can drum up more demand for the latest models and help Qualcomm report better results.
The firm’s Q2 FY24 revenue was only up by 1% YoY. It’s not what you would expect from a growth stock, but that’s why QCOM shares trade at a 25 P/E ratio. While revenue growth was mild, net income growth came in good with a 37% YoY improvement.
Qualcomm is enabling leading on-device AI capabilities. Those tailwinds can change the tide. It was only a few quarters ago when Qualcomm reported double-digit YoY revenue declines, so the recent earnings report shows a positive development. Analysts have rated the stock as a Moderate Buy. The average price target only suggests a 1% decline, but the highest price target of $220 per share indicates a potential 16% gain.
PayPal (PYPL)
PayPal (NASDAQ:PYPL) is down by roughly 80% from its all-time high. The payment processing firm got ahead of itself during the pandemic and may never reclaim its all-time high. However, that doesn’t mean current investors should bail.
For starters, the stock is up by 5% year-to-date and has a 16 P/E ratio. PayPal’s growth stock days are over, but it’s still achieving moderate success. Revenue went up 9% YoY while GAAP EPS jumped 18% YoY in Q2 FY24. PayPal operates with double-digit net profit margins.
The fintech firm also returned $1.5 billion to stockholders through share repurchases and still has $17.7 billion in cash, cash equivalents and investments. That’s more than enough to cover the company’s $11.0 billion in total debt.
PayPal remains a popular resource for making online payments. The company collects fees from each of these payments and has turned itself into a top-tier company. It offers growth at a reasonable price for current investors.
Meta Platforms (META)
Meta Platforms (NASDAQ:META) is currently rated as a Strong Buy and has a projected 11% upside. The highest price target of $593 indicates that a 26% gain is possible. Shares are already up by 34% year-to-date and have gained 159% over the past five years. Meta Platforms trades at a reasonable 27 P/E ratio and offers a 0.42% yield.
Recent financial results suggest that the company’s P/E ratio will get much lower. Meta Platforms reported 117% YoY net income growth, with 27% YoY revenue growth in Q1 2024.
More people continue to create accounts across Meta Platforms’ family of apps. Daily active users across all platforms came to 3.24 billion. That’s a 7% YoY increase. Meta Platforms has been trimming its headcount while delivering impressive profits for its investors. The company is also investing heavily in artificial intelligence. Advertising is still the core piece of the business, and it will remain that way for several years. However, artificial intelligence can offer Meta Platforms other ways to meaningfully diversify its revenue beyond advertising.
On this date of publication, Marc Guberti held long positions in GOOG and SNPS. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.