Goldman Sachs expects demand for AI data center equipment to stay strong in 2025 and 2026. This will benefit companies that sell to hyperscalers like Arista Networks, Cisco, and Juniper Networks.
The world is going to look shockingly similar in 5 years, despite massive technological innovation enabled by AI.
— Logan Kilpatrick (@OfficialLoganK) December 29, 2024
It will also help those that sell to tier 2 cloud and enterprise customers such as Cisco, Dell, HPE, Super Micro, and Penguin Solutions.
The investment bank also sees the PC and campus networking markets recovering and growing again in 2025.
Four AI predictions for 2025
While the momentum behind the development of large models might fade, there will be other advances https://t.co/Vi7q4FLhi6 @RichardWaters @ft
— Spiros Margaris (@SpirosMargaris) December 28, 2024
Goldman’s top stock picks for 2025
Analysts believe the drivers of a PC refresh are still in place despite a miss in 2024.
These include an aging PC installed base, the end of Windows 10 support, and demand for AI-capable PCs. Goldman’s top stock picks in the hardware and software space for 2025 include:
Here's a look at 5 AI trends that are expected in 2025#NewYear2025 #ArtificialIntelligence https://t.co/rz2Utm3ooa
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– Dell Technologies (price target of $165, 38% upside)
– Arista Networks (price target of $120, 4% upside)
– Penguin Solutions
Among IT distributors, the firm recommends:
– Ingram Micro (price target of $33, 62% upside)
– TD Synnex (price target of $141, 18% upside)
The analysts view these IT distributors as relatively attractive ways to invest in the 2025 cyclical recovery theme. They are among the primary distributors of PCs and campus networking equipment.
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