AI stocks have been leading the bull market run and making record highs. This has also led to an increase in AI spending in the form of data centers, chips, and research.
There appears to be a high probability that the AI bull run will also continue in 2025. Based on this, the two AI stocks which stand to gain the most in 2025 are Dell Technologies (DELL) and Marvel Technology (MRVL).
If we look at DELL, it is now something a lot more than a company that sells PCs. The company has been at the forefront of AI infrastructure and sells servers that are optimized for AI.
Right now, the valuation of DELL is still very attractive based on the company's long-term growth forecasts. If we look back, the P/E multiple of DELL has always been historically low when compared with other tech stocks.
However, this changed when Dell announced an 86% y/y increase in its EPC during Q2. But even that, the P/E multiple of DELL is still very attractive.
The target price for DELL is $215 in the year 2025 which is an upside of almost 57%. That's quite a bullish forecast given the DELL share price of around $137.
The second AI stock that can gain a lot in 2025 is Marvell Technology (MRVL). The company sells semiconductor products for networking and data centers and also stands to gain the most from investment in AI. In 2024, MRVL reached new highs and is currently trading at a 55% upside from its starting price.
There's ample room for the MRVL stock to move higher as its revenue from data centers has almost doubled on a q/q basis.
According to experts, the earnings of MRVL will grow at a rate of 23% on an annual basis during the next few years. This automatically means that the shares of MRVL (AI stock) will keep moving higher during the next couple of years.