Top-Picked AI Stocks for 2025: Industry Experts Single Out Two Stellar Companies Instead of Nvidia and Palantir
Investors, brace yourself. Ditch the conventional wisdom about NVidia and Palantir and prepare to meet two lesser-known but fiercely promising AI companies. Piper Sandler's astute analysts have singled out these stocks as the ones to watch in 2025. Here's why.
The AI Market: A Gigantic Goldmine Awaits
Despite a bumpy ride this year, the potential of Artificial Intelligence (AI) remains brimming. The technology, still in its fledgling stage, promises a meteoric rise in the coming years. According to Grand View Research, the global AI market is set for an eye-watering 36.6% annual growth rate by 2030.
Choosing the best AI stocks for 2025 has become a formidable challenge. Enter Piper Sandler, whose analysts have honorably risen to the occasion. These financial whizzes have handpicked two top AI stocks that they believe will reap immense rewards thanks to an imminent monetization wave.
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Piper Sandler's A-Listers: Take Note
In their new analysis, Piper Sandler's savvy analysts foresee an exciting new monetization wave that could bring immense wealth in the coming years. Here are their two favorite AI companies that could stand to reap the most benefits:
1. Snowflake - The Data Powerhouse of the AI Century
Snowflake, a cloud-based data management powerhouse, has been making waves by enabling businesses to efficiently store, process, and analyze torrents of data without investing in costly IT infrastructure. With backing from billionaire Warren Buffett, Snowflake has caught the attention of investors worldwide.
The Snowflake platform seamlessly combines data warehousing, big data, and AI analysis and runs on the industry's leading cloud services such as AWS, Microsoft Azure, and Google Cloud. As AI models require massive data sets, Snowflake's services are becoming increasingly indispensable. Companies can store their data securely and prepare and analyze it for AI models.
Brent Bracelin, an analyst at Piper Sandler, has observed that the company is on a steady growth trajectory. Corporate surveys indicate that more and more companies are increasingly investing in data and AI workloads, further fueling demand for Snowflake services.
With nearly $4 billion in revenue and solid profit margins, Snowflake is well-positioned to reap the benefits of the AI revolution. New products like Snowpark and Cortex AI are catching on fast, albeit they currently represent only a small slice of Snowflake's revenue pie. However, as the company has barely scratched the surface of the vast data market, experts see boundless growth potential by 2028.
With a new CEO and a renewed focus on product innovation, Piper Sandler is betting big on Snowflake. The firm rates the stock as "Overweight" with a price target of $215, implying a 44% upside. The majority of analysts admit that Snowflake is a stock worth owning, with an average price target of $213, predicting an upside of around 40%.
2. Autodesk - The Artificial Intelligence Ushers in a New Era of Design and Construction
Autodesk, a renowned software company for design, construction, and animation, is the second stock on Piper Sandler's list. Autodesk is famous for AutoCAD, the widely-used computer-aided design software and a mainstay solution in architecture, engineering, and product design.
Beyond AutoCAD, Autodesk delivers powerful tools for 3D modeling, visualization, and simulation. These include popular software like Revit, Fusion 360, and Maya, used across various industries such as construction, mechanical engineering, media, and entertainment.
Autodesk thrives in the AI boom. AI-assisted technologies are automating, optimizing, and speeding up design and construction processes. Generative design empowers algorithms to suggest innovative and efficient structures, revolutionizing architecture and product development. Additionally, AI enables more precise simulation and error detection, significantly reducing development times and costs. As a result, Autodesk becomes increasingly indispensable in the toolkit of engineers, designers, and creatives.
Analysts forecast that Autodesk will continue to bolster its profitability thanks to mid-teens EBIT growth and a strong free cash flow margin. Piper Sandler rates Autodesk as "Overweight", with a price target of $357, equating to a 45% upside.
The majority of analysts also remain bullish, with an average price target of $347, promising a 38% upside.
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Disclosure of Potential Conflict of Interest: The price of the financial instruments in this article is derived from an index that Boerse Medien AG has developed and owns the rights to. Boerse Medien AG has entered into a cooperation agreement with the issuer of the displayed financial instruments, granting the issuer a license to use the index. In this context, Boerse Medien AG receives remuneration from the issuer.
Artificial Intelligence (AI) is expected to experience a significant growth rate in the coming years, making it an attractive investment opportunity. Piper Sandler has identified two AI stocks that are poised to benefit from this growth wave: Snowflake, a cloud-based data management company helping businesses with data analysis, and Autodesk, a software company providing tools for design, construction, and animation that leverage AI technology for automation and optimization.
