2 stocks Wall Street says could grow sales by 100% (or more) in 2 years

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Strong sales growth is often an indicator of a quality business, especially when sustained over a long period of time. Many of the best-performing stocks share this trait. And few companies grow their sales faster than CrowdStrike Holdings (CRWD -0.36%) and snowflake (SNOW -1.00%).

Between fiscal 2022 and fiscal 2024 (ending January 31, 2024), CrowdStrike and Snowflake revenues are expected to grow 110% and 158%, respectively, according to Wall Street consensus estimates. Better still, both of these stocks are backed by solid investment theses and now looks like a good time to buy.

Here’s why.

1. CrowdStrike

Cybersecurity specialist CrowdStrike is thriving thanks to the unique architecture of its cloud platform. Many vendors burden endpoint devices by installing multiple software products, and these products often result in downtime due to required reboots. But CrowdStrike delivers 22 different software modules through a single lightweight agent that can be installed without rebooting. This makes the adoption smooth.

Additionally, CrowdStrike’s platform captures trillions of security signals every week, helping its artificial intelligence engine to predict and prevent even the most sophisticated attacks. In fact, as the leader in endpoint security, CrowdStrike has more data than other vendors, making its AI models theoretically uniquely effective. This lead has placed the company at the forefront of other vertical cybersecurity industries, including digital threat intelligence and incident response services.

Building on this momentum, CrowdStrike has delivered impressive growth on a consistent basis. Revenue rose 64% last year to $1.6 billion and free cash flow rose 49% to $481 million. Still, CrowdStrike has barely scratched the surface of its $58 billion market opportunity — but investors have good reason to believe the company will continue to grow rapidly.

CrowdStrike has a track record of strong execution and rapid innovation. It recently launched the industry’s first fully managed identity threat protection solution, meaning organizations that lack the time or talent can outsource identity protection to CrowdStrike’s team of experts. This product expands its already robust suite of managed services, including endpoint security and cloud workload protection. More broadly, this type of innovation should give CrowdStrike an edge over the competition. That’s why this growth stock is a Buy.

2. Snowflake

Snowflake helps companies understand big data. Its cloud platform (known as Data Cloud) supports workloads such as data collection, storage and analysis, as well as more demanding use cases such as application development and data sharing. The Snowflake Data Marketplace even allows organizations to buy and sell datasets.

Beyond this broad functionality, Snowflake benefits from its targeted approach to customer acquisition. The company offers industry-specific versions of its platform, tailored to end markets such as financial services, healthcare, and retail. This strategy has helped Snowflake win large customers such as MasterCard, McKessonand PepsiCo.

Over the past year, Snowflake saw its customer base grow 40% and the average customer spent 74% more, proving its ability to build lasting relationships. In turn, revenue soared 98% to $1.4 billion, and the company generated $227 million in free cash flow positive, up from a $75 million loss a year earlier. But management sees a $90 billion addressable market, which means Snowflake still has plenty of room to grow.

Last summer, the company launched Powered by Snowflake, a program to help customers build and run applications on the Snowflake Data Cloud. Through fiscal 2023 (ended April 30, 2022), over 425 organizations had joined the program, up 48% from the previous quarter. This rapid adoption underscores the value Snowflake creates for its customers.

More broadly, Snowflake benefits from a strong network effect. As more customers adopt Data Cloud, more data can be exchanged on the platform, creating value for each user. This virtuous cycle should keep Snowflake growing for the foreseeable future. In fact, management expects product sales to reach $10 billion by fiscal 2029 (ending Jan. 31, 2029), a sevenfold growth in less than seven years. That’s why it’s worth buying this stock today.

Trevor Jennewine has positions at CrowdStrike Holdings, Inc. and Mastercard. The Motley Fool has positions in and recommends CrowdStrike Holdings, Inc., Mastercard, and Snowflake Inc. The Motley Fool recommends McKesson. The Motley Fool has a disclosure policy.

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