THE Nasdaq-100 index composed of shares issued by the 100 largest non-financial companies listed on the Nasdaq Stock Exchange, started the year on a positive note. It posted gains of 14% in 2023, bringing some relief to investors who have seen the index lose more than 15.4% of its value over the past year.
It should be noted that the Nasdaq tends to rebound strongly after a year of decline. Cooling inflation and the resilience of the US economy could be catalysts for equities in 2023 and send the market into an eventual uptrend. That’s why investors may want to load up a few Nasdaq-100 stocks that could soar in 2023 and beyond.
Airbnb (ABNB -1.21%) the stock is already crushing the market this year with gains of 38%. In the meantime, Datadog (DDOG -1.65%) jumped 6.1%, and it wouldn’t be surprising to see this fast-growing cloud software company jump higher. Let’s take a look at why Airbnb and Datadog are two Nasdaq stocks investors should consider buying in February.
1.Airbnb
Airbnb’s strong start to the year is set to continue on strong travel and tourism demand in 2023. International travel could climb 40% this year, according to Euromonitor International, while another report from the United Nations World Tourism Organization (UNWTO) suggests that international tourist arrivals could rebound to pre-pandemic levels in 2023.
Specifically, the UNWTO projects that international tourist arrivals could be between 80% and 95% of pre-pandemic levels in 2023. This would be a nice increase from last year, when international arrivals s rose to 63% of pre-pandemic levels. This should set the stage for another good year for Airbnb.
The company’s revenue in 2022 increased approximately 39% to $8.35 billion. More importantly, the vacation rental and accommodation market provider is expected to post a profit of $2.59 per share against a loss of $0.57 per share in 2021. Wall Street expects that Airbnb is also showing attractive growth over the next two years.
ABNB EPS estimates for current year data by YCharts
There are several reasons why Airbnb should be able to post healthy growth in the short and long term.
First, TechNavio estimates that the global vacation rental market could add $79 billion in revenue between 2021 and 2026. Airbnb’s addressable market is therefore expected to grow significantly over the next few years.
This brings us to the second reason why the company’s impressive growth should be here to stay. Europe would be Airbnb’s biggest market. Ultimately, Europe is expected to account for 37% of additional vacation rental spending through 2026, according to TechNavio.
Meanwhile, Airbnb remains the preferred vacation rental platform in the world’s largest vacation rental market, the United States. The vacation rental segment in the United States is expected to generate $19.4 billion in revenue in 2023. reservations, the company is well positioned to make the most of this lucrative market.
Even better, Airbnb’s strong position in major vacation rental markets around the world should translate to annual earnings growth of 20% over the next five years, according to consensus estimates. All of this indicates that investors may want to double down on Airbnb in February as a strong earnings report from the company later this month could give its stock price a boost.
2. Data dog
Datadog stock has lost 47% of its value over the past year, but the company’s astounding growth rate indicates that savvy investors can buy growth stock on the cheap here.
Datadog will release its fourth quarter and full year 2022 results on February 16. share. Even better, Datadog should maintain its exceptional growth in the future.
DDOG EPS Estimates for Current Year Data by YCharts
Analysts estimate Datadog’s impressive annual earnings growth of 47% over the next five years. A closer look at the company’s addressable opportunity shows why it is capable of achieving such impressive growth.
Datadog is a provider of security, analytics and monitoring platforms for cloud applications. Its offerings are used by developers, IT (information technology) teams, and enterprise cloud users. Its tools allow customers to monitor cloud infrastructure, application performance and security in real time, as well as other services such as user experience and network performance monitoring.
Datadog is said to be one of the biggest players in its space thanks to its comprehensive platform, which is why the company is seeing a nice increase in customer spending and higher adoption of its platform. For example, the number of Datadog customers with more than $100,000 in annual recurring revenue jumped 44% year-over-year in Q3 2022 to 2,600. Its total number of customers jumped 27%. year-over-year to reach 22,200 in the quarter.
Additionally, 40% of Datadog’s customers were using four or more of its products in Q3 2022, up from 20% in the same period of 2020. Unsurprisingly, the company reported an impressive net dollar retention rate of more of 130% for the 21st consecutive quarter in Q3 2022, which indicates an increase in the use and adoption of its products by customers.
As such, the company is in a strong position to tap into its vast addressable market, which was worth around $41 billion last year. Additionally, the company’s addressable opportunity could reach $62 billion by 2026.
Overall, Datadog has the potential to become a long-term growth stock, so investors should consider doubling down on it before it begins to soar.
