Two Technology Stocks Analysts Are Optimistic About in 2025
The technology sector features some of the most successful growth stocks in the market. Over the past five years, the tech-heavy Nasdaq Composite index has more than doubled. With artificial intelligence (AI) gaining traction among Fortune 500 companies, several investment opportunities remain appealing for long-term investors.
According to Wall Street analysts, Advanced Micro Devices (NASDAQ: AMD) and Monday.com (NASDAQ: MNDY) show significant upside potential this year.
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Advanced Micro Devices: A Leader in AI Hardware
The rise of AI software is leading to increased investments in advanced hardware for data centers. Powerful graphics processing units (GPUs) are essential for training AI models, driving remarkable revenue growth for AMD last year. Current Wall Street analysts project a 12-month price target of $183 for AMD shares, surpassing its current price of $120 by 52%.
In Q3, AMD’s data center revenue soared by 122% year over year, reaching $3.5 billion. Key partners, like Microsoft and Meta Platforms, position AMD favorably as they expand data center capacities to support AI workloads.
Management estimates the AI accelerator market could reach $500 billion by 2028, showcasing the growth potential ahead. AMD is also a top supplier of central processing units (CPUs), gradually gaining market share from Intel. Its client segment reported a revenue increase of 29% year over year in Q3.
Analysts expect AMD’s total revenue to climb by 27% in 2025, reaching $32 billion, as per Yahoo! Finance. The anticipation of higher profit margins from advanced AI chip sales may push earnings up by 54%, with shares currently available at a forward price-to-earnings ratio of just 24. This strong earnings growth could drive AMD shares closer to Wall Street’s price target within a year.
Monday.com: The Go-To for Work Management
Monday.com has solidified its position as a leading supplier of work management software. Organizations are increasingly choosing its cloud-based platform to automate tasks, build applications, and enhance team collaboration on projects. This subscription-based model has helped revenue surge from $161 million in 2020 to $906 million on a trailing-12-month basis.
Despite fierce competition in the software market, Monday.com continues to display a growth rate exceeding 30% year over year and is nearing $1 billion in annual sales.
Even after a recent price hike, strong demand for Monday.com’s platform persists. The company further enhances its competitive edge by launching new features, such as an AI-powered assistant that is gaining traction among users.
Profitability is also on the rise as the company scales. Having previously recorded net losses, Monday.com achieved nearly $22 million in net income over the past four quarters.
With a stock increase of 25% over the last year, it currently trades at a price-to-sales multiple of 13. To reach Wall Street’s average price target of $319, a 35% increase from its recent price of $235, the company must either surpass revenue expectations in 2025 or see its price-to-sales multiple rise.
If Monday.com maintains its current valuation, it could rise alongside revenue growth. Analysts predict a 26% revenue increase in 2025, presenting a favorable investment opportunity.
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Randi Zuckerberg, a former director of market development at Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is on The Motley Fool’s board of directors. John Ballard holds positions in Advanced Micro Devices. The Motley Fool also holds positions in and recommends Advanced Micro Devices, Intel, Meta Platforms, Microsoft, and Monday.com. They also recommend certain options. Full disclosure policy available.
The views expressed here are solely those of the author and do not necessarily reflect the views of Nasdaq, Inc.
