Two Leading Tech Stocks Worth Investing In Now

Investing in leading technology stocks can enhance an investor's portfolio heading into 2025.

The stock market thrived in 2024, driven primarily by the technology sector, despite the persistent theme of artificial intelligence (AI) keeping investors eager for significant returns. The bullish trend appears to have room for continued growth.

As the stock market might experience a pause in the coming months, technology stocks are likely to succeed, fueled by developments in predictive AI, cloud computing, automation, cybersecurity, semiconductors, and other cutting-edge technologies. Investors stand to gain from these evolving trends by acquiring shares in top-quality, fundamentally robust technology stocks. Here are two technology stocks that are promising candidates.

Nvidia: Leading the Charge in AI-based Computing

Nvidia (nvidia.com) is at the forefront of the discrete graphics processing unit (GPU) market, boasting an impressive 90% market share.

The demand for Nvidia's current Hopper architecture GPUs remains high, and the upcoming Blackwell architecture GPUs are expected to further stimulate demand among hyperscalers, with supply anticipated to struggle to keep pace.

With machine learning, powered by GPUs, increasingly taking over traditional CPU-based computing in data centers around the globe, CEO Jensen Huang predicts that over $1 trillion worth of data center infrastructure will need an upgrade to accelerated computing by 2027, highlighting a substantial growth opportunity for Nvidia.

The company is also tapping into the vast potential of AI services operating around the clock, referred to as AI factories.

Nvidia's Compute Unified Device Architecture (CUDA), which is designed for parallel programming on GPUs, is a significant asset in maintaining Nvidia's leadership position in the AI-optimized GPU sector. This software is utilized by nearly 4 million developers across over 3,000 applications, establishing a solid competitive advantage for Nvidia.

During CES 2025, CEO Jensen Huang unveiled an exciting new product: the personal AI supercomputer named NVIDIA Project DIGITS, which leverages the new NVIDIA GB10 Grace Blackwell superchip and is priced at $3,000 each. This supercomputer allows developers to run complex inference for large language models (LLMs) with up to 200 billion parameters independently.

The expansion of AI supercomputing capabilities represents a significant growth catalyst for Nvidia in the upcoming years.

Additionally, Nvidia is advancing in the physical AI realm with the launch of the Cosmos World foundation model platform, which simplifies the development and deployment of complex physical AI solutions like autonomous vehicles and robots. This platform streamlines the development process for physical AI, addressing the challenges of complexity, cost, and time investment.

Nvidia's financial performance continues to impress, with analysts estimating revenues of around $38 billion for the fourth quarter of fiscal 2025 (ending January 31, 2025), reflecting a remarkable year-over-year increase of 72.1%. The projected earnings per share (EPS) stand at $0.85, showcasing a solid year-over-year rise of 63%.

Since the start of 2023, Nvidia shares have skyrocketed by an astounding 830%. While Wall Street has already recognized the company's technological expertise and expansive market, the potential for future growth suggests even more upward movement for its shares in the months ahead.

Meta Platforms: Leveraging AI for Advertising Growth

Meta Platforms (meta.com) presents itself as an attractive technology investment for 2025 for multiple reasons.

Firstly, Meta's core social media and digital advertising business continues to exhibit remarkable strength and monetization potential. The company's revenues rose 19% year-over-year to $40.6 billion in the third quarter of fiscal 2024 (ending September 30, 2024). The Family of Apps, which includes major platforms like Facebook, Instagram, Messenger, and WhatsApp, accounted for nearly 93% of total revenues, achieving an impressive operating income of $21.8 billion and an operating margin of 54% in the third quarter.

In total, 3.2 billion users, representing almost 40% of the global population, engaged with at least one of Meta's applications daily. The company is harnessing advanced AI technologies to enhance personalized recommendations on its platforms, which has resulted in increased user engagement—evident in an 8% rise in time spent on Facebook and a 6% increase on Instagram. This boost in engagement has led to more ad impressions and improved pricing for advertising on these platforms.

Secondly, Meta is swiftly advancing in the AI sector with the introduction of large concept models (LCMs), which outperform many similarly sized large language models (LLMs). Unlike traditional LLMs that process information one token at a time, LCMs operate on discrete concepts, enabling efficient reasoning and planning, resulting in accurate responses with lower computational costs.

At the end of the third quarter, Meta reported holding $70.9 billion in cash, indicating the company's commitment to investing significantly in innovative AI projects. After successfully launching the Llama 3.2 LLM, Meta is now training the Llama 4 models on a large cluster equipped with over 100,000 Nvidia H100 chips. The company anticipates launching smaller Llama 4 models by early 2025. The open-source nature of the Llama models contributes to a more efficient and cost-effective system, potentially benefiting Meta in the coming years.

Lastly, Meta is exploring various monetization opportunities, including the Threads platform, Ray-Ban Meta smart glasses, and WhatsApp Business.

Despite its strong business model and bright growth outlook, Meta is currently trading at a relatively modest forward price-to-earnings (P/E) ratio of 23.9. Although challenges such as ongoing losses in Reality Labs and increasing capital expenditures pose risks, Meta appears to be a savvy investment choice for early 2025.

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