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 is one Nasdaq 100 stock that could lead the market and two best left off your watchlist.
Two Stocks to Sell:
PACCAR (PCAR)
Market Cap: $62.27 billion
Founded more than a century ago, PACCAR (NASDAQ: PCAR) designs and manufactures commercial trucks of various weights and sizes for the commercial trucking industry.
Why Are We Hesitant About PCAR?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 10% annually over the last two years
- Gross margin of 16.5% is below its competitors, leaving less money to invest in areas like marketing and R&D
- Falling earnings per share over the last two years has some investors worried as stock prices ultimately follow EPS over the long term
PACCAR is trading at $118.39 per share, or 21.2x forward P/E. Dive into our free research report to see why there are better opportunities than PCAR.
Cisco (CSCO)
Market Cap: $312.1 billion
Founded in 1984 by a husband and wife team who wanted computers at Stanford to talk to computers at UC Berkeley, Cisco (NASDAQ: CSCO) designs and sells networking equipment, security solutions, and collaboration tools that help businesses connect their systems and secure their digital operations.
Why Are We Wary of CSCO?
- Scale is a double-edged sword because it limits the company’s growth potential compared to its smaller competitors, as reflected in its below-average annual revenue increases of 1.6% for the last two years
- Free cash flow margin dropped by 5.9 percentage points over the last five years, implying the company became more capital intensive as competition picked up
- Waning returns on capital imply its previous profit engines are losing steam
At $79.20 per share, Cisco trades at 18.2x forward P/E. To fully understand why you should be careful with CSCO, check out our full research report (it’s free).
One Stock to Buy:
DoorDash (DASH)
Market Cap: $67.97 billion
Founded by Stanford students with the intent to build “the local, on-demand FedEx", DoorDash (NASDAQ: DASH) operates an on-demand food delivery platform.
Why Will DASH Outperform?
- Orders have increased by an average of 22% annually, giving it the potential for margin-accretive growth if it can develop valuable complementary products and features
- Incremental sales over the last three years have been highly profitable as its earnings per share increased by 931% annually, topping its revenue gains
- Free cash flow margin jumped by 13 percentage points over the last few years, giving the company more resources to pursue growth initiatives, repurchase shares, or pay dividends
DoorDash’s stock price of $155.95 implies a valuation ratio of 17.8x forward EV/EBITDA. Is now a good time to buy? Find out in our full research report, it’s free.
Stocks We Like Even More
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don't just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
But our AI platform says the party isn't over. Find out which 9 stocks made the cut this week — FREE. Get Our Top 9 Market-Beating 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-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.
