Nasdaq’s Future Looks Bright: A Year of Potential Stock Gains Ahead
The Nasdaq Composite (NASDAQINDEX: ^IXIC) has seen remarkable growth over the past few years. Investors in technology stocks have been inspired by several factors, including the economic recovery, rapid advancements in artificial intelligence (AI), easing inflation, and the ongoing reduction of interest rates. After a solid gain of 43% in 2023, the index added another 29% in 2024.
While no investment is without risk, historical data indicates potential for further profits in 2025. Since 1972, following annual gains of 28% or more, the Nasdaq has typically experienced an average increase of 19% in the subsequent year. This trend suggests that 2025 could also be a fruitful period for investors.
Two High-Potential Nasdaq Stocks to Watch
As we explore investment opportunities, let’s highlight two Nasdaq stocks that analysts believe could rise significantly in 2025, with estimates of potential gains reaching as high as 153%.
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ASML: A Steady Climb Ahead with 66% Upside
First on our list is ASML (NASDAQ: ASML). This company manufactures advanced lithography systems essential for microchip production. Notably, ASML is the sole global supplier of extreme ultraviolet (EUV) lithography technology, a crucial resource for producing advanced semiconductors. This unique position sets ASML apart from its competitors.
For context, Taiwan Semiconductor Manufacturing, ASML’s largest customer, produces about 92% of the world’s most advanced chips, highlighting the increasing demand for ASML’s technology due to the rapid growth of AI.
In the third quarter, ASML reported a 12% annual increase in revenue, totaling 6.67 billion euros (approximately $6.85 billion). Earnings per share (EPS) also rose by 10% to 5.28 euros (about $5.42).
CEO Christophe Fouquet anticipates continued growth, projecting net sales of 32.5 billion euros in 2025, a 16% increase over the forecast for 2024. He predicts that sales growth will average between 8% and 14% over the next five years.
Analyst Sandeep Deshpande from JPMorgan asserts that ASML could see a significant increase in stock value with a price target of $1,148, representing a potential upside of 66% based on recent closing prices. Though the stock has declined 36% from its July peak due to some postponed sales, Deshpande views this as a temporary setback with long-term investment opportunities ahead.
Symbotic: Leading Warehouse Automation with 153% Potential
With the rapid growth of e-commerce, the need for efficient fulfillment and advanced warehouse automation has surged. Symbotic (NASDAQ: SYM) stands at the forefront of this movement.
The company specializes in AI-driven solutions to automate warehouse processes, utilizing advanced algorithms and robots equipped with computer vision to optimize space and efficiency. This technology not only streamlines operations but also significantly reduces labor costs and enhances cost-effectiveness.
For instance, in fiscal 2024’s fourth quarter, Symbotic reported revenues of $577 million, marking a substantial 47% increase year-over-year, while turning a profit with an EPS of $0.05, a significant recovery from losses in the same quarter the prior year.
Despite having some accounting restatements that concerned investors, management clarified that these adjustments had no effect on full-year results. Following this, Cantor Fitzgerald analyst Derek Soderberg reiterated a buy rating with a price target of $60, translating to a promising upside of 153% from recent closing prices.
Furthermore, Symbotic’s stock is priced at under 1.3 times sales, an appealing valuation considering its pivotal role in an expanding industry.
Is ASML a Wise Investment for $1,000?
If you’re contemplating investing in ASML, some notes deserve attention:
The Motley Fool Stock Advisor analyst team recently highlighted ten other stocks they believe are top picks right now, and ASML was not among them. Historically, early investments like Nvidia have paid off tremendously, illustrating the potential for high returns when selecting the right stocks.
As a reminder, Stock Advisor has delivered impressive returns, outpacing the S&P 500 significantly since its inception.
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*Stock Advisor returns as of December 30, 2024
Disclaimer: The opinions expressed in this article are solely those of the author and may not reflect those of Nasdaq, Inc.
