Investing.com -- Wedbush analysts expect a 25% rise in tech stocks in 2025, driven by reduced regulatory pressures under a potential Trump presidency.
The departure of Federal Trade Commission (FTC) Chair Lina Khan and a more AI-friendly environment in Washington are seen as tailwinds for Big Tech heading into next year.
"We believe tech stocks will be robust in 2025 on the shoulders of the AI Revolution and $2 trillion+ of incremental AI cap-ex over the next 3 years,” analysts led by Daniel Ives said in a note.
They highlight that while concerns around Federal Reserve policies, tensions with China, and stretched valuations may lead to volatility, these dips are expected to offer buying opportunities.
Wedbush emphasizes that sticking to core tech names remains a key part of its investment approach, highlighting its “top 10 tech winners for the AI revolution in 2025.”
These include Nvidia (NASDAQ:NVDA), Microsoft (NASDAQ:MSFT), Palantir (NASDAQ:PLTR), Tesla (NASDAQ:TSLA), Google (NASDAQ:GOOGL), Apple (NASDAQ:AAPL), MongoDB (NASDAQ:MDB), Pegasystems (NASDAQ:PEGA), Snowflake (NYSE:SNOW), and Salesforce (NYSE:CRM).
Software (ETR:SOWGn) is now viewed as a critical part of the AI landscape, with analysts pointing to expanding use cases and growing enterprise adoption expected to accelerate in the coming year.
"The AI Software era is now here in our view. We believe the two best software plays on the AI Revolution into 2025 remain Palantir and Salesforce...with many well-positioned software vendors joining the AI Party," Wedbush states.
Meanwhile, Nvidia’s dominance in AI hardware continues to stand out, with its role described as pivotal in the sector’s growth. "The start of this $2 trillion+ of AI spending all began with the Godfather of AI Jensen and Nvidia as they remain the only game in town with their chips the new gold and oil,” analysts continued.
Cloud giants like Microsoft, Google, and Amazon (NASDAQ:AMZN) are expected to build on this momentum, playing an essential part in shaping the AI Revolution as it enters its next phase.