2 Nasdaq-100 Stocks to Buy Before They Soar 105% and 130%, According to Wall Street

The Nasdaq-100 index includes 100 of the largest non-financial companies in the Nasdaq Composite (NASDAQINDEX:^IXIC). Most Wall Street analysts see triple-digit upside in two of those stocks, as explained below:

• CoreWeave (NASDAQ:CRWV) has a median target price of $142.50 per share. That implies 126% upside from its current share price of $62.
• Rocket Lab (NASDAQ:RKLB) has a median target price of $105 per share. That implies 105% upside from its current share price of $51.

Here's what investors should know about these technology stocks.

Image source: Getty Images.

CoreWeave: 126% upside implied by Wall Street's median target price

CoreWeave is a leading neocloud company. Its data centers are purpose-built to support artificial intelligence (AI) workloads, using large clusters of Nvidia graphics processing units (GPUs) to provide clients with the computing power needed for training and inference tasks.

CoreWeave is widely regarded as a leader in AI cloud services. Its systems routinely deliver record-breaking results when measured in objective tests, reflecting expertise in managing GPU clusters. Dylan Patel at SemiAnalysis called CoreWeave an operational benchmark for the industry. "CoreWeave's sustained excellence across the stack is unique."

CoreWeave shares surged 14% when the company reported strong second-quarter results, beating estimates on the top and bottom lines. Revenue increased 112% to $2.5 billion, but the non-GAAP net loss widened to $567 million, driven by increased interest expense as CoreWeave continued to finance infrastructure expansion projects.

Essentially, CoreWeave is growing very quickly due to massive demand for AI infrastructure, and CEO Michael Intrator told analysts, "We expect demand to meaningfully exceed supply for years." But the company is also spending a tremendous amount of money to achieve that growth. The question is this: Can CoreWeave convert that demand into durable profits quickly enough to cover its infrastructure investments and financing costs?

Of course, it is impossible to answer that question with absolute certainty. But CoreWeave currently trades at 4.3 times sales, which looks relatively cheap for a company whose revenue is projected to grow at 101% annually through 2028. With shares 66% below their record high, investors should consider buying a small position in this AI stock today.

Rocket Lab: 105% upside implied by Wall Street's median target price

Rocket Lab is a vertically integrated aerospace and defense company that manufactures and launches rockets, satellites, and spacecraft components. Its Electron rocket carries small satellites into orbit, while its larger Neutron rocket is being developed to carry heavier payloads. Its customers include commercial satellite operators and the U.S. military.

Rocket Lab has a competitive advantage in that it has already dedicated several years and substantial capital to developing reliable rockets. Space Exploration Technologies remains the dominant player in the commercial space launch, but Rocket Lab is one of the few companies that could compete with SpaceX.

Rocket Lab reported reasonably good financial results in the second quarter. Revenue rose 62% to $234 million, driven by strong demand for its space systems and launch services. The company lost $0.08 per diluted share, an improvement from $0.13 per diluted share in the same quarter last year. The company also reported a record backlog of $2.3 billion, up 137%, hinting at strong future revenue growth.

Valuing Rocket Lab is difficult because the company is not profitable. But the stock trades at 39 times sales, an expensive valuation even when Wall Street expects revenue to grow at about 40% annually through 2028. For context, only three stocks in the S&P 500 have higher price-to-sales ratios than Rocket Lab.

Here's the bottom line: Investors interested in the burgeoning space economy can buy a few shares of Rocket Lab today, but I would keep the position very small. The valuation, coupled with intense competition from SpaceX, makes it a somewhat risky investment. There is no guarantee this stock doubles in the next year.

Trevor Jennewine has positions in Nvidia. The Motley Fool has positions in and recommends Nvidia and Rocket Lab. The Motley Fool has a disclosure policy.