The Top 6 AI Stocks For 2025

Jan. 15, 2025 5:00 AM ETCLS, CLS:CA, DOCU, FARO, FRSH, PRLB, TWLO109 Comments
(22min)

Summary

  • AI fever has helped power a two-year bull run on Wall Street as investors bet heavily on tech companies leveraging AI's power, a market projected to reach $1.36T by 2032.
  • Not all AI stocks are created equal, as evidenced by AI ETFs, registering mixed performance amid some stretched tech valuations. Investors must choose carefully.
  • SA Quant has identified six top AI stocks (three large and three "SMID" caps) with solid valuations and high earnings growth potential.
  • These recommendations have a levered free cash flow margin of ~18.6% and have returned an average of ~60% over the past year.
AI symbol with speech bubbles

J Studios

The AI frenzy continues to rage on Wall Street…

According to data provider EPFR, investors have poured more than $5 billion into technology sector funds during the past 15 months. This trend was driven higher by three consecutive interest rate cuts

  • I am Steven Cress, Head of Quantitative Strategies at Seeking Alpha. I manage the quant ratings and factor grades on stocks and ETFs in Seeking Alpha Premium. I also lead Alpha Picks, which selects the two most attractive stocks to buy each month, and also determines when to sell them.

This article was written by

64.65K Followers

Steven Cress is VP of Quantitative Strategy and Market Data at Seeking Alpha. Steve is also the creator of the platform’s quantitative stock rating system and many of the analytical tools on Seeking Alpha. His contributions form the cornerstone of the Seeking Alpha Quant Rating system, designed to interpret data for investors and offer insights on investment directions, thereby saving valuable time for users. He is also the Founder and Co-Manager of Alpha Picks, a systematic stock recommendation tool designed to help long-term investors create a best-in-class portfolio.

Steve is passionate and dedicated to removing emotional biases from investment decisions. Utilizing a data-driven approach, he leverages sophisticated algorithms and technologies to simplify complex, laborious investment research, creating an easy-to-follow, daily updated grading system for stock trading recommendations.

Steve was previously the Founder and CEO of CressCap Investment Research until its acquisition by Seeking Alpha in 2018 for its unparalleled quant analysis and market data capabilities. Prior to that, he had also founded the quant hedge fund Cress Capital Management, after spending most of his career running a proprietary trading desk at Morgan Stanley and leading international business development at Northern Trust.

With over 30 years of experience in equity research, quantitative strategies, and portfolio management, Steve is well-positioned to speak on a wide range of investment topics.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given that any particular security, portfolio, transaction or investment strategy is suitable for any specific person. The author is not advising you personally concerning the nature, potential, value or suitability of any particular security or other matter. You alone are solely responsible for determining whether any investment, security or strategy, or any product or service, is appropriate or suitable for you based on your investment objectives and personal and financial situation. Steven Cress is the Head of Quantitative Strategy at Seeking Alpha. Any views or opinions expressed herein may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank.

Recommended For You

Related Stocks

SymbolLast Price% Chg
CLS--
Celestica Inc.
CLS:CA--
Celestica Inc.
DOCU--
DocuSign, Inc.
FARO--
FARO Technologies, Inc.
FRSH--
Freshworks Inc.

Related Analysis