According to CNN Business, PayPal Holdings (PYPL 1.94%) and Snowflake (SNOW 0.19%) have a consensus rating of "buy" on Wall Street, and some analysts are forecasting triple-digit gains for shareholders. The Street-high price target on PayPal is $160 per share, which implies a 113% upside from its current price. The Street-high price target on Snowflake is $500 per share, which implies a 243% upside from its current price.

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

1. PayPal

PayPal got off to a rocky start last year. Management cut guidance and pulled its medium-term financial targets as economic conditions deteriorated. But the company was quick to cut costs and prioritize investments in areas where it already has a strong competitive position, including PayPal checkout, Braintree checkout, and the PayPal and Venmo digital wallets. Those actions helped salvage what could have been a much worse year. Revenue climbed 8% to $25.4 billion in 2022, and non-GAAP (adjusted) earnings dropped 10% to $4.13 per diluted share.

The future looks even brighter. PayPal plans to cut $1.9 billion  in expenses this year, which management believes will drive 18% growth in non-GAAP earnings. Beyond that, the company is perfectly positioned to benefit as digital payments become more prevalent in physical and digital commerce. PayPal is the most accepted digital wallet in North America and Europe, and it continued to gain share last year. PayPal is also the leader in online payment processing, with a 42% market share.

That strong competitive position reflects the benefits of its two-sided payments network. Whereas most payment providers work only with merchants, PayPal offers financial services to merchants and consumers. That means the company has a deeper understanding of consumer spending habits than many of its peers, and that data allows PayPal to separate legitimate and illegitimate transactions very effectively. In fact, CEO Dan Schulman says PayPal has the highest authorization rate and the lowest loss rates in the industry.

The company is also working to increase its presence at physical points of sale. It launched the PayPal Zettle Terminal in the U.S. last year, an all-in-one point of sale (POS) solution for small and medium-sized businesses. PayPal also partnered with Apple to bring its Tap to Pay for iPhone to the PayPal and Venmo iOS apps. The partnership will also allow consumers to store PayPal and Venmo-branded payment cards in their Apple Wallets for use anywhere Apple Pay is accepted. That is particularly noteworthy because Apple Pay is the most popular in-store mobile wallet in the U.S., meaning it could have a material impact in helping PayPal gain traction at physical checkouts.

Currently, PayPal stock trades at 3.2 times sales, a bargain compared to the three-year average of 8.8 times sales. That creates a worthwhile buying opportunity for patient investors, but the odds of triple-digit returns in the next year are slim in the current economy. Investors should plan to hold the stock for at least three to five years.

2. Snowflake

Snowflake helps businesses manage and make sense of big data. Its platform solves the problem of siloed datasets created by cloud migration and software proliferation. The Snowflake Data Cloud allows clients to ingest, store, and analyze the data spread across their IT infrastructure while freeing them from the burden of managing the underlying infrastructure. The Data Cloud also lets clients securely share data, build data-driven applications, and transform data for use cases like artificial intelligence and machine learning.

So what? Snowflake helps businesses draw insights from sprawling datasets, and no other product on the market supports the same range of workloads. Additionally, its data-sharing capabilities create a network effect. The platform becomes more valuable each time more data is added simply because more data is available for exchange. Clients also benefit from its infrastructure-neutral disposition. The Data Cloud runs across Amazon Web Services, Microsoft Azure, and Alphabet's Google Cloud Platform, meaning clients are free to work with the cloud computing vendor of their choosing.

Snowflake is growing like wildfire. Its customer count increased 31% to 7,828 in the fourth quarter, and the average customer spent 58% more over the past year. In turn, revenue climbed 69% to $2.1 billion in fiscal 2023 (ended Jan. 31, 2023), and free cash flow (FCF) soared sixfold to $496 million, representing a healthy FCF margin of 24%. And investors have good reason to believe Snowflake can maintain that momentum.

Digital transformation is fueling the creation of tremendous amounts of data, and effectively harnessing that data can help businesses make better decisions and build more powerful applications. The Data Cloud was engineered for that very purpose, and management believes it addresses a $248 billion market opportunity, meaning Snowflake has hardly scratched the surface of its potential.

Currently, shares trade at 22.5 times sales. That valuation multiple is a significant discount to the historical average of 74.1 times sales, but it certainly isn't cheap. Investors may want to wait for a better entry point, though risk-tolerant investors could reasonably consider buying a very small position in this Warren Buffett stock right now. But given the challenging economy, the odds of triple-digit returns any time soon are remote at best.