Let’s be honest: Last year belonged to Nvidia. The company, which produces high-powered, cutting-edge semiconductors that are often used to train artificial intelligence (AI) models, recorded a total return of 239% in 2023. Nvidia was the best-performing stock in the Nasdaq 100, and overall it recorded one of the highest annual returns of any publicly listed stock.
But a new year has arrived. So let’s consider which stocks might dethrone Nvidia and truly shine in 2024.
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CrowdStrike has the wind at its back and could be the stock of the year in 2024
Jake Lerch (CrowdStrike Holdings): My choice for king of 2024 is CrowdStrike Holdings (NASDAQ: CRWD). The company, which provides AI-powered cybersecurity services to its clients, is riding high after a memorable 2023.
Indeed, few stocks performed better than CrowdStrike in 2023. Shares rallied 137% thanks to skyrocketing cybersecurity demand and improving financial fundamentals.
Let’s start with the overall demand for cybersecurity. Hacking and digital blackmail cases are on the rise. In fact, the last few months of 2023 saw an explosion of notable cyberattacks that brought prominent organizations to their knees.
In September, hackers targeted hospitality and gaming giant MGM in a cyberattack that caused massive disruptions to the company’s operations. Several pieces of key infrastructure — including slot machines, hotel key cards, and ATMs — malfunctioned or were rendered inoperable as a result of the hack.
Meanwhile, in October, genetics testing firm 23andMe disclosed a data breach that affected at least 14,000 customers. In a public relations disaster, sensitive customer data appears to have been compromised and then sold on the dark web.
Due to the rapid increase of these real-world nightmare scenarios, CrowdStrike’s anti-hacking products are more in demand than ever, and its financial metrics are soaring. Revenue in its most recent quarter (the three months ending on Oct. 31, 2023) grew 35% year-over-year to a trailing twelve-month total of $2.9 billion. Free cash flow jumped to…
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