The dominance of tech in nearly every facet of life is reason enough to support the top names in the space. While Big Tech has powered recent gains in the economy, a group of smaller companies has helped push the S&P to new highs. This bodes well for investors eager to add more tech diversity to their portfolios.
Given the broad spectrum of tech stocks, let’s focus on companies with the most exciting product launches for this story. I believe these tech innovations ultimately set the stage for long-term returns.
Nvidia (NVDA)
Once a relatively unknown name, Nvidia (NASDAQ:NVDA) quickly climbed up the tech ranks with its AI chips. After tripling its stock price since 2023, the company recently achieved a new milestone €”a $3 trillion market cap. This is a result of its dominant position in the AI chip market, with its technology worth tens of thousands of dollars.
Nvidia’s latest price bump comes after the company announced the launch of the next generation of AI chips. Codenamed Blackwell, the chips are expected to be more advanced than their predecessor, the H100. Amidst a growing demand for generative AI technology, the sales from Blackwell will cement Nvidia’s position as an AI leader. Nvidia’s leather-jacketed CEO, Jensen Huang, says the chips will bring in a lot of revenue this year.
I think NVDA’s current share price presents a great entry point into the market. While critics may say the price is too high, I think the broad utility of its AI chips adds merit to its valuation.
Nvidia’s strong position in the AI market puts this among the best tech stocks to buy for outsized returns.
Hewlett Packard Enterprise (HPE)
Hewlett Packard’s (NYSE:HPE) recent AI-fueled results make it one of the best tech stocks to buy right now. In its recent earnings report, the PC giant reported revenue at $7.2 billion, up 3% from a year ago. One among several reasons for this strong performance can be attributed to its GreenLake tech as a service platform, which saw a 39% uptick in revenue to $15 billion.
A second reason for investor optimism in the stock comes from the demand for its AI servers. The meteoric rise of AI technology has proven to be immensely favorable for companies like HPE that power data centers with AI solutions. According to the company’s CEO, processing Nvidia’s new tab AI-powered chips now takes six to twelve weeks. The latest manufacturing timelines will enable HPE to ship out its backlog in the coming months. According to analysts, revenue from the sale of these chips will push the company’s net worth up by $2 billion.
HPE’s much-awaited AI bump makes this the perfect time to get behind this name, with some predicting share prices as high as $23.
CrowdStrike (CRWD)
Another company that’s thriving amidst strong demand for generative AI technology is CrowdStrike (NASDAQ:CRWD). The cybersecurity giant came out on top in its recent earnings report, posting strong Q1 numbers. Revenue peaked at $921 million, up from $693 million a year ago. Several factors anchored CrowdStrike’s impressive performance. This includes its subscription revenue, which accounts for most of its revenue growth. Subscriber revenue increased by 34% YOY to $872 million.
A second tailwind for the company is the performance of its Unified Falcon Platform. The technology is designed to power the next generation of cybersecurity solutions with AI-generative tools. Its features include workflow automation, lightning-fast data transmission, and incident innovations. In its recent earnings call, the company alluded to the success of this platform, stating that “it enables CrowdStrike to solve the industry’s biggest cybersecurity, IT, and data problems.”
Adding to its strong performance this past quarter, the company also paints a rosy revenue outlook. Guidance for the next quarter will range from $958.3 million to $961.2 million, beating analysts’ forecast of $954.4 million. CrowdStrike attributes this outlook to its differentiated cybersecurity platform, which could be a game-changer for companies in the AI era.
Crowdstrike stands firm with consistent growth and is among the top tech stocks to buy in today’s market.
On the date of publication, Divya Premkumar did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Divya has a background in finance and accounting and has worked in FP&A roles at Fortune 500 companies. She is an avid reader and enjoys writing on a variety of topics including stocks, crypto, blockchain and global policy.